Geoffrey Richard Bull and Susan Bull v Freixenet S.A

[1994] ATMO 8

TRADE MARKS ACT 1955

DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS

Re:Opposition by FREIXENET, S.A. to trade mark application number 571664 in the name of GEOFFREY RICHARD BULL and SUSAN BULL

Background
Application number 571664 was lodged, on 3 February 1992, in the name of GEOFFREY RICHARD BULL and SUSAN BULL (together, the applicant).  The application was for registration of a series of composite marks shown on page 2 which includes the word FREYCINET and which was advertised as accepted in the Official Journal of 16 April 1992 for the statement of goods, "Wines and other goods in this class" in Class 33.  The application was accepted with the endorsement, inter alia:

Registration of this trade mark shall give no right to the exclusive use of the words TASMANIA and FREYCINET

The disclaimer of the word FREYCINET had been sought by the examiner on the grounds that the word was a geographical term and this was consented to by the applicant as a condition of registration.

Notice of opposition to the mark's registration was lodged on 8 July 1992 by FREIXENET S.A. (the opponent).  The main grounds of opposition, as stated in the notice, may be summarised as relating to: s.33 of the Act, that the mark closely resembles one or more of the opponent's prior registration numbers A231671, A231673, A231674, A351507, A354190 and A354191, all of which included the word FREIXENET; s.28, that the mark's use by the applicant would be likely to deceive or cause confusion, would be contrary to law and would not be entitled to protection in a court of justice; s.40, that, the applicant was not the proprietor of the trade mark; and s.6(2), that the applicant did not use the mark on all of the goods claimed.

The evidence

The service and lodgment of the opponent's and applicant's respective evidence in support, answer and reply in the matter was completed by 17 August 1993 and comprised:

Evidence in support

*Statutory declaration by Khajaque Kortian dated 6 October 1992.

*Statutory declaration by Brian Marsden Munday dated 6 October 1992 and exhibits BMM-1 and BMM-2

*Statutory declaration by Trevor Ross Bailey dated 30 October 1992

Evidence in answer

*Statutory declaration by Huon Hooke dated 31 March 1993

*         Statutory declaration by Max Lake dated 7 April 1993

*         Statutory declaration by George Fesq dated 4 March 1993

*         Affidavit by Geoffrey Richard Bull dated 16 April 1993

Evidence in reply

*Statutory declaration by Peter McAtamney dated 16 August 1993 and exhibit PM-1

On 30 August 1993, the opponent applied for a hearing under the provisions of reg.49 and the matter was set down before me, as the Registrar's delegate, in Sydney on 21 October 1993.  The opponent was represented at the hearing by Mr David Yates of Counsel, assisted by Dr Brian Munday of Spruson & Ferguson, trade mark attorneys.  Appearing on behalf of the applicant was Mr R.Webb of Counsel, instructed by Mr A.Melick of Gunson, Pickard & Hann, Barristers & Solicitors.

Submissions

Mr Yates said that the opponent would be relying upon ss.28, 33 and 40 in the present proceedings and that each of the related issues would be addressed in turn.  He said that the opponent's registrations comprised a variety of marks with the common element FREIXENET, and covered goods which ranged from sparkling wines to all wines in Class 33.  All of these registrations predated the present application.

With respect to reputation, Mr Yates pointed to the fact that the opponent had been selling its wines in Australia since the early 1970s and had acquired a significant position in the market place.  Sales had grown steadily and, in 1992, 90,000 cases had been sold with a retail value of almost $1m.  By comparison, the applicant could only claim first use of its label in 1985 and even this assertion was based on the statements of only four people.  He said that the appropriate test for deciding an opposition under s.28(a) was found in Smith Hayden & Co Ltd's Appn (1946) 63 RPC 97. This was essentially that, having regard to the reputation acquired by the mark, is the Registrar satisfied that, if the mark is used in a normal and fair manner for any of the goods applied for, deception and confusion will occur amongst a substantial number of persons. In the case of Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, Kitto J had applied this test and outlined five propositions which needed to be kept in mind when determining matters of this sort. These included that the onus is on the applicant to show the Registrar that there was no reasonable probability of confusion; that it is not necessary for the opponent to prove that confusion has occurred; that all the surrounding circumstances should be considered, including the way marks are used, ie that both sales of goods under the mark and the types of persons purchasing the goods under the marks should be considered; that the rights of the parties should be determined as at the date of the application; and that the onus on the applicant must be discharged for all of the goods applied for in the specification.

Mr Yates said that the word FREYCINET was the dominant feature of the present mark and that purchasers would use that word in requesting the goods - Golden Crumpet Co Australasia v Hardings Manufacturers Pty Ltd (1987) 8 IPR 147. He said that there could be similar pronunciations given to the applicant's and his client's marks and he pointed to instances, cited in the opponent's evidence, of confusion occurring because of this. He said that the words FREYCINET and FREIXENET were also visually similar which added to the possibility of deception occurring. He referred to the declarations by wine experts included in the applicant's evidence in answer which attested to a lack of knowledge of confusion between the marks. He said that, although the declarants were perhaps experts in their field and could easily differentiate between the products, the ordinary purchasers of the wines produced by both parties could range from the astute to the gullible, and included all ages and levels of sophistication. In addition, the comments by these declarants seemed more appropriate for passing off proceedings rather than a dispute over trade marks, and concentrated on the differences in getup or between sparkling and still wines. Therefore, the views of these experts could not be considered convincing and should be given little weight. It would not overcome the problem if the applicant excluded sparkling wines from the statement of goods, as the average consumers of wine would infer that similar marks on any style of wine would have a common source. In any case, the opponent owned registrations which covered all the goods of the present application. The applicant had not, in his submission, discharged the onus to show that deception would not accordingly occur if the mark was registered.

With respect to the s.33 leg of the opposition, Mr Yates submitted that the test here was that the Registrar should be satisfied that, assuming notional use, there would be no likelihood of confusion between the competing marks before dismissing an opposition on this ground.  The opponent had obtained registrations for similar marks which covered all of the goods claimed by the applicant and not just the opponent's well known sparkling wines which the applicant's declarants had considered.  He said that, given the aural and visual similarity of the words FREYCINET and FREIXENET, the Registrar could not be satisfied that the marks in question were not deceptively similar and, taking into consideration the well known doctrine of imperfect recollection, there was a real likelihood of deception and confusion.

With respect to the question of proprietorship of the mark under the terms of s.40, Mr Yates said that, by virtue of the opponent's ownership of the trade mark registration number A351507, which covered all of the goods of the present application, there was no doubt that the opponent was the author of the word FREIXENET in Australia.  The applicant had taken for its use, perhaps innocently, a word which is substantially identical to that word and this raised the question of proprietorship.  It was immaterial if other material was present in the subject mark; it had still taken the dominant word in contention.  In any case, the applicant could not claim to be the author of the word FREYCINET in Australia, as that word had formed part of a mark lodged by a Western Australian producer in January 1985.

In reply, Mr Webb said that, although the goods covered by the application included "all wines", the goods of particular interest to the applicant were "still wines" and, if it was necessary to achieve registration, the applicant was willing to restrict the goods accordingly.  He said that the mark in question was not just the word FREYCINET alone.  It was a distinctive and well known mark comprising many elements - including an artistic drawing.  The mark was distinctive of the applicant, not only because of its wide use on wines since 1985, but because wines bearing the mark had won several prizes and this added to the mark's distinctiveness in fact.  Mr Webb said that, while he agreed with Mr Yates that consideration in the matter should be given to ss.28 and 33, he did not agree that Mr Yates had applied them correctly in making his submissions.  The task was to consider the marks both visually and aurally and, then, having regard to market conditions and the present mark's use, consider whether such use caused deception or confusion, given the opponent's reputation.  In any case, it had to be decided whether the marks were deceptively similar.  He said that, in the present instance, the visual element was the most important aspect to consider.  He relied for support here on the finding in Deeko Australia Pty Ltd v Decor Corp Pty Ltd (1988) AIPC 90-479, where it was held that the visual differences in marks carry more weight when the goods are displayed on shelves with little intervention from sales staff. This was important here because the usual method of sale of wines in bottle shops or liquor stores was to allow customers to make their own selection. Mr Webb submitted that, in the applicant's mark, the most striking aspect was the picture, followed by the other material. The mark was very different to the opponent's marks - especially those including device components.

With respect to market considerations, he said that another thing which should be taken into account was that the applicant had only used its mark on still wines, whilst the opponent had only, up to this time, used its mark in Australia on sparkling wines.  There was a high sensitivity in the wine purchasing community to brand differences and, in practice, the applicant's mark attached to still wines would not be confused with the opponent's mark on sparkling wines.

On the matter of the pronunciation of the two words, Mr Webb submitted that the word FREYCINET was always pronounced the same way but the word FREIXENET had a variety of pronunciations.  He alleged that Mr Kortian, a declarant for the opponent, had carried out an entrapment exercise to create confusion when ordering bottles of the applicant's and opponent's wines in a bottle shop.  Any other instances of confusion cited in the opponent's evidence were also the result of contrived and forced situations.  He said the Registrar should therefore attach no weight to such examples, seeking support in the case of Ritz Hotel Ltd v Charles of the Ritz & Anor (1988) 12 IPR 417, where McLelland J ruled some material inadmissible as he said it was for the court to assess, "how the ordinary person is likely to be influenced by questions framed in particular ways".

On the matter of the proprietorship of the subject mark, Mr Webb said that to claim that the applicant was not the owner of its mark because one feature of it was allegedly similar to another mark was clearly wrong.  The applicant's mark was not merely an embellishment of the opponent's mark but one where the disputed word was different and also one where there was significant other material.  He said that the meaning of proprietorship under s.40 had been articulated by McGarvie J in Settef S.p.A. v Riv-Oland Marble Co (Vic) Pty Ltd 10 IPR 402 at 413 but his Honour had clearly outlined a situation which was not the case here. The applicant's mark was not just the word FREYCINET. That word was a geographical term which had been disclaimed and it was first used by the applicant as a part of composite mark. That word was not an adaptation of FREIXENET and, any case, it was only one element of the mark at issue.

Decision

Firstly, I cannot agree with Mr Webb's assertion that the tests for deciding matters under ss.28 and 33 of the Act are essentially the same.  As will be seen from the following discussion, the courts have outlined different tests to be applied in deciding matters under those sections..

Section 28 - Deception and confusion

The provisions of this section of the Act read as follows:

A mark -

(a) the use of which would be likely to deceive or cause confusion;
           (b) the use of which would be contrary to law;
           (c) which comprises or contains scandalous matter; or

(d) which would otherwise be not entitled to protection in a court of justice,

shall not be registered as a trade mark.

The test to be applied under paragraph (a) of these provisions, on which the opponent partly relies, has been well established by cases such as Southern Cross, supra, where t said:

Registration should be refused if it appears that there is a real risk that the result of the user of the mark will be that a number of persons will be caused to wonder whether it might not be the case the two products come from the same source.

That risk must extend to a substantial number of people: Kendall Co v Muslyn Paint and Chemicals (1963) 109 CLR 300.

Following the High Court decision in New South Wales Dairy Corporation v Murray Goulburn Co-operative Company Ltd 18 IPR 385 (the Moo case) the Registrar now follows the practice as laid out in the decision of Hearing Officer Homann in Titan Manufacturing Co v John Terrence Coyne 22 IPR 613 - that is, that all paras of s.28 should be read together. This means that, should I find that the marks are likely to deceive or cause confusion, then it will also be necessary to find that the mark would not be entitled to protection in a court of law.

In assessing the reputation of the opponent's marks in Australia, the relevant date is the date of lodgment of the opposed application - Southern Cross, supra, - 3 February 1992.  I accept from the opponent's evidence that, at the relevant date, the opponent had a well established reputation in this country for its marks, in particular the word FREIXENET, - although it would seem only to be so for sparkling wines.  However, I cannot accept the opponent's assertion that a substantial number of persons would be confused or deceived as to the origin of the two marks in question.  Most Australians would, I believe, be aware of the existence of Tasmania's Freycinet Peninsula, and would thus infer a geographical meaning from the word FREYCINET, pronouncing it it the same way - "fray-sin-nay".  However, the word FREIXENET is differently spelt and would appear unusual to most observers in this country.  I believe that the word, when spoken, would evoke a variety of pronunciations - most differences centring on the first syllable, FREIX-, which would be pronounced either "frex" or "fresh".  The last letter, "T", could also be pronounced hard or soft.  I believe that it is stretching the point to allege that a wide number of people would arrive at the same pronunciation of the two words, given the phonetic variety of choices of the latter and the relative unity of articulation of the former.  Additionally, I feel that contemporary Australian wine drinkers display a high level of knowledge and sophistication, in relation to wines, which would have been unthinkable a generation ago.  They know what they are drinking and like to make the choice themselves from bottle shops or restaurant wine lists where it is, in my opinion, a convention to distinguish Australian and overseas wines.  Many Australians have travelled abroad and would know of FREIXENET wines.  However, the reputation in this country of the opponent's goods seems to only extend to sparkling wines, something which the applicant freely admits to having no interest in producing - despite the wide range of goods claimed in the statement of goods.  In addition, the applicant has produced declarations by Australian wine experts who, although they cannot be described as typical Australian wine drinkers, have a good knowledge of the industry and declare that they know of no confusion between the marks used by the opponent and the applicant.  There has been no evidence put forward by the opponent to show any significant degree of deception caused by the applicant's mark.  I believe that the behaviour revealed in the declaration by Mr Kortian was designed to seek a desired response from an eager-to-please shop assistant.  I therefore give that evidence little weight in deciding the matter.

For the foregoing reasons, I find that use of the applicant's mark will not lead to deception or confusion.  I am therefore satisfied that the requirements of paragraph 28(a) have not been made out.

Given the above, I need not proceed further in relation to the s.28 objection.  However, for the record, I note that there is nothing before me to show that there has been any blameworthy conduct on the part of the applicant nor any other circumstance which would disentitle the mark to protection in a court of justice.  Therefore, the requirements of paragraph 28(d) have also not been made out.  The opponent's case in terms of s.28 must therefore be dismissed.

Section 33

Sub-section 33(1) reads:

Subject to this Act, a trade mark is not capable of registration by a person in respect of goods if it is substantially identical with or deceptively similar to a trade mark which is registered, or is the subject of an application for registration, by another person in respect of the same goods, of goods of the same description as those goods, or of services that are closely related to those goods, unless the date of registration of the first-mentioned trade mark is, or will be earlier than the date of registration of the second-mentioned trade mark.

The test to be applied under s.33 of the Act may be stated as follows, paraphrasing and adapting the words of Evershed J. to the present situation in Smith Hayden & Co Ltd's Application (1946) 63 RPC 97, in which he compared the test under s.12 of the Trade Marks Act 1938 (UK), which corresponds to s.33 of the Trade Marks Act 1955 (Cth):

The questions for my decision (...) have been formulated, and I think accurately formulated, as follows:

...

"Assuming user by the opponent of its marks FREIXENET with or without devices in a normal and fair manner for any of the goods covered by the registration of that mark (..). is the Registrar satisfied that there will be no reasonable likelihood of deception and confusion amongst a substantial number of persons if the applicant also uses its mark FREYCINET and device normally and fairly in respect of any goods covered by their proposed registration?"

There is no doubt as to whether the goods covered by both the applicant's and opponent's marks are those of the same description.  The statements of goods of the opponent's marks cover all kinds of wines, including sparkling wines, spirits and liqueurs.  The present mark's statement falls within that, covering "Wines and other goods in this class"

In considering the question of whether the mark in question is caught by the provisions of s.33, I must firstly determine whether it is substantially identical with, or deceptively similar to, the marks owned by the opponent. 

To judge whether the subject mark is substantially identical to the opponent's mark, it is necessary to carry out a straight comparison of the two marks.  In the case of Shell Co (Aust) Ltd v Esso Standard Oil (Aust) Ltd (1963) 109 CLR 407, the words of Windeyer J. at p.414 are pertinent:

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 similarity that emerges from the comparison ...

In my opinion, the marks are not substantially identical.  The marks have distinct differences which are readily observed.  Although containing the disputed word FREYCINET the applicant's mark contains a pictorial element which is unlike any of the marks owned by the opponent.  I therefore find that the marks are not substantially identical and move on to decide if the marks are deceptively similar.  Sub-section 6(3) defines a mark as deceptively similar if it is likely to deceive or cause confusion.

Here the marks should not be placed side by side but consideration should be given to any common net impression inferred from the two marks.  I refer here to the judgment in Australian Woollen Mills Ltd v F.S.Walton & Co Ltd (1937) 58 CLR 641, where Dixon and McTiernan JJ. said:

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.

I have already said, in relation to the s.28 objection, that the words FREYCINET and FREIXENET are spelt and, I believe, pronounced differently.  I do not agree that there is a common nett impression which could be inferred from the marks.  The word FREYCINET is a well known geographical term in Australia and would, in my mind, denote the area of the wine's production.  On the other hand, the word FREIXENET has no obvious meaning except, to wine drinkers, as a Spanish sparkling wine.  I therefore find that the mark cannot be considered deceptively similar to the opponent's marks.  For the foregoing reasons, I find that the opponent's objection as it is based on s.33 must also fail.

Section 40 - Proprietorship

The provisions of s.40, so far as is relevant here, are that:

A person who claims to be the proprietor of a trade mark may make application to the Register for registration of that trade mark in Part A or Part B of the Register

On that subject, McGarvie J said in Settef, supra, at 413):

The basic common law principle is that the first person who uses a trade mark of an appropriate type within a country becomes the proprietor of the mark there: Re Registered Trade Mark "Yanx"; Ex parte Amalgamated Tobacco Corp Ltd (1951) 82 CLR 199 at 203; Thunderbird Products Corp v Thunderbird Marine Products Pty Ltd (1974) 131 CLR 592 at 603; Moorgate Tobacco Co Ltd v Philip Morris Ltd(No 2) 59 ALJR 77 at 83.
            ...

In considering who, within s.40(1) of the Act, was at the time of Settef's application for registration the proprietor of the trade mark, one considers who at common law was the proprietor in Australia: The Shell Co of Australia Ltd v Rohm & Haas (1949) 78 CLR 601 at 625 and 627.

In other words, the first user of the mark in Australia (for relevant goods and prior to the date of application) becomes the proprietor at common law.  That proprietorship, however, is limited to "the same kind of thing", per Holroyd J in Re Hick's trade mark (1897) 22 VLR 636 at 639. 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 goods of a particular trader are being offered for sale in Australia.

I am not concerned, in deciding the issue of proprietorship, with the question of whether the opponent's and applicant's marks are so alike as to lead to the deception or confusion of customers.  That question is relevant in relation ss.33 and 28, but not to s.40 which only applies when the marks are identical or so similar as to be virtually the same mark - The Kendall Co v Mulsyn Paint and Chemicals (1962-63) 109 CLR 300; Tavefar Pty Ltd v Life Savers (Australasia) Ltd 12 IPR 159.

On the issue of proprietorship of the present mark, therefore, I am satisfied that, even though the evidence shows that opponent is the proprietor of the mark FREIXENET in Australia for wines, and particularly for sparkling wines, prior to the date of the application, it has not for that reason defeated the applicant's claim to proprietorship of its own different mark under s.40 based on the combined effect of authorship, use and application for the mark - Shell Co (Aust) Ltd v Rohm and Haas Co, supra.  The composite mark of the applicant is not identical or so similar as to be virtually the same mark as any of the opponent's marks.

Mr Yates said that, whether or not the marks are not the same, the applicant is not the author of the mark in this country by virtue of the prior existence of registration number 571664 (now cancelled under s.19) which included the word FREYCINET.  However, in Settef, supra, McGarvie J. concluded that proprietorship in a trade mark, having once been established, could be lost by intentional abandonment, acquiescence or estoppel, but not by mere disuse.  He went on to look at the facts and stated intentions to "infer from this whether Settef formed an intention to abandon".  I think that the act of requesting cancellation of a registered mark under s.19 can be inferred as intentional abandonment of a mark and, as a consequence, I find that the present applicant has become the proprietor of the word FREYCINET with respect to wines in Australia.  I therefore find that the objection under s.40 also does not succeed.

Intention to use
Mr Bull has stated in his declaration, lodged as evidence in answer, that the applicant has not used and does not intend to use its mark in relation to "sparkling wines".  The application would therefore appear to be caught by the provisions of s.6(2) with respect to use of the mark in relation to those goods.  It would follow, therefore, that the applicant is not the proprietor of the mark under s.40 for those goods.  I therefore find that the mark should not have been accepted for those goods and that they should be removed from the specification before it qualifies for registration.

Conclusion
I find that the opponent has failed on all but one of the grounds stated in the notice of opposition.  Although the point was not pursued at the hearing, I think that it is clear that the applicant, on its own admission, does not intend to use the mark on all of the goods claimed.  In consequence, I allow the applicant 28 days from the date of this decision to delete the items "sparkling wines" from the statement of goods.  Mr Webb did indicate at the hearing that the applicant would be so prepared but confirmation of this in writing will be necessary to allow the matter to proceed.  If the applicant complies with this condition, I find, subject to any appeal from this decision, that the application should proceed to registration for the amended statement of goods.  In the event that it does not agree to restrict the goods before the expiry of that time, I will issue a final decision refusing the application.

Costs

Both sides sought costs in the matter.  It was only at the hearing that the applicant canvassed the possibility of an amendment to its statement of goods in an effort to placate the opponent.  However, this was after the opponent had gone to the time and expense of gathering its evidence in support.  Should the applicant now formally agree to restrict its goods as above, I think it is true to say that both sides have been partially successful.  In those circumstances, it would appear to be proper for each party to bear its own costs and this I would so order.  However, if the applicant decides not to amend the statement of goods and I issue my decision refusing the application, the opponent will have been successful in its opposition.  I would then order that costs be awarded in favour of the opponent.

Ian Forno
Hearing Officer

28 January 1994