H&R Johnson Tiles Ltd v Johnson Industrial Holding AG - [2004] ATMO 20

TRADE MARKS ACT 1995

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

Re:Opposition by H & R Johnson Tiles Ltd to registration of trade mark application 772587(11) Johnson Suisse filed in the name of Johnson Industrial Holdings AG.

Delegate:

Ian Thompson

Representation:

Opponent

Andrew Lockhart of Baldwin Shelston Waters.

Applicant

Carmen Champion of Counsel instructed by FB Rice & Co.

Decision:

1. Section 52 Opposition: s43, s41(5), s44, goods not of same description; s60; opposition not established.

2. Costs awarded against opponent.

Background

Johnson Industrial Holdings AG, ('the applicant') of Switzerland, has filed application to register a trade mark, current details of which are:

App No: 772587 divisional of 708037

Priority Date: 7 May 1996

Services:Class: 11 Sanitary ware, being water closets, toilet suites, toilet pans, toilet seats and toilet covers, urinals, bidets; bathroom suites, baths, basins, sinks, and shower trays

Trade Mark: JOHNSON SUISSE

Endorsements: Provisions of paragraph 44(3)(a) applied.
Provisions of paragraph 41(5) applied

The above endorsements reflect objections to registration reported by the examiner. The grounds for rejection in terms of section 41 were because the trade mark comprises a common surname in combination with the French or Swiss word which means SWISS in English. The objection under sections 44 arose on citation of registrations 588913 and 666427, owned by the opponent. The applicant submitted evidence of the use of the trade mark addressed to both grounds for rejection.
After examination, the application was advertised accepted for registration in the Australian Official Journal of Trade Marks, on 13 June 2000. On 15 December 2000, H & R Johnson Tiles Limited ('the opponent') filed Notice of Opposition to registration of the trade mark. Most of the available grounds of opposition were cited on the Notice.
Evidence in support was served and filed as was evidence in answer. The opponent then served and filed evidence in reply. Both parties then filed further evidence. A hearing was held before me, as a delegate of the Registrar of Trade Marks, in Sydney, on 17 March 2004. Mr Andrew Lockhart, of Baldwin Shelston Waters, Patent and Trade Mark Attorneys, Sydney, represented the opponent; Ms Carmen Champion, of counsel, instructed by FB Rice & Co, also of Sydney, represented the applicant.

Evidence

Evidence served and filed in this matter comprises:

Declarant	Position Known as	Date Made	Exhibits
Evidence in Support
Stephen Sheldon Dixon	Finance Director Dixon	4 April 2002	A - C
Charles Gregory	Marketing Director Gregory	7 June 2002	CG-1 – CG-19
Evidence in Answer
Thong Lai Kuan	Finance Director Kuan	26 February 2003	A-F
Robert Johnson	General Manager Johnson	12 March 2003
Alan Quick	Managing Director Quick	18 March 2003

Evidence in reply
Andrew Scott Lockhart	Trade Mark Attorney Lockhart	23 September 2003	ASL-1 – ASL-12
Applicant’s Further Evidence
Joanne Christine Martin	Trade Mark Attorney Martin	13 January 2004	JCM1 – JCM5
Opponent’s Further Evidence
Richard Earp	Sales & Marketing Manager Earp	19 February 2004	Re-1 – RE-5

At the hearing, both parties sought to rely on evidence of Thong Lai Kuan, filed during examination of the application. At the time, I expressed strong reservations about whether this was appropriate as it had not been served or filed by either party as evidence in relation to these proceedings.
The primary consideration regarding evidence in this matter is procedural fairness and ensuring that neither party is ambushed by reliance by the other on material on the official file to which the other has not had access. Another consideration, where both parties have had access to the official file and the contents are not in the formal evidence, is whether they have had sufficient notice that grounds stemming from the material might be pursued at the hearing in order to properly prepare submissions.
Here both parties prepared their submissions as if the evidence filed during the examination of the application had been properly served and filed as evidence in these proceedings. It is with a degree of reluctance and reservation that I will treat this material as if it had been served and filed.
The evidence shows:

Dixon

Mr Dixon is Finance Director of the opponent of Stoke-on-Trent, England. The opponent is a multi-national manufacturer and retailer of ceramic tiles under the trade mark JOHNSON – each tile sold by the opponent bears the JOHNSON trade mark on its reverse side.
The opponent has a considerable number of trade mark registrations around the world including in Australia. Details of the Australian registrations are:

Reg Number 588912

Priority date: 21 October 1992

Goods/Services: Class: 19 Ceramic tiles

Trade Mark: H & R JOHNSON

Endorsements: The provisions of sub-section 24(2) applied. Registration gives no right to the exclusive use of the letters H and R.

Reg Number 588913

Priority date: 21 October 1992

Goods/Services: Class: 19 Ceramic tiles

Trade Mark: JOHNSON

Endorsements: The provisions of sub-section 24(2) applied

Appn Number 666427

Priority date: 11 July 1995

Goods/Services: Class: 19 Tiles

Trade Mark:

Endorsements:

The opponent’s tiles are distributed in Australia by Johnson Tiles Pty Limited: both the opponent and Johnson Tiles Pty Limited are subsidiaries of Norcross (Holdings) Limited.
Sales of the opponent’s tiles in Australia started in 1926. The opponent’s sales of ceramic tiles under the trade mark JOHNSON in Australia are substantial and, at the priority date of the opposed application, exceeded $30 million a year.
Amounts spent by the opponent on advertising and promoting the goods sold under the trade mark JOHNSON totalled some one million dollars a year at the priority date of the opposed application.

Gregory

Mr Gregory is Marketing Director of Johnson Tiles Pty Limited of Baywater, Victoria. He exhibits a great deal of packaging, point of sale material and advertising material to his declarations showing the uses of the opponent’s trade marks.
Mr Gregory states that he is aware that the goods of the parties are frequently sold through the same retail outlets and includes a list of outlets at CG-1 to his declaration. Yellow Pages entries to support Mr Gregory contention are exhibited to his declaration.
Mr Gregory also states that the goods of the parties (tiles and sanitary goods) are shown together in trade displays; and, that, in his opinion, the goods of the parties are closely related goods, sold in the same retail and trade outlets to the same customers.

Thong Lai Kuan

Mr Kuan is Finance Director of Johnson Suisse (Malaysia) Sdn Bhd, a wholly owned subsidiary of the applicant. Mr Huan attests to moderate use of the opposed trade mark for some three years in Australia before the priority date of the opposed application (7 May 1996). I note that sales of the opponent’s goods increased marked after the priority date of the application and before the filing date of the application which was on 8 September 1998.
Appended to his declaration are invoices, catalogues and brochures relating to the use of the opposed trade mark.

Johnson

Mr Johnson is General Manager of Johnson Suisse (Australia) Pty Limited (‘JSA’). He had been employed by JSA since July 2002 and cites prior experience with the parties’ products via his four years experience in the sales and marketing of property. He says that he had, in 2003, been aware of the applicant’s products for about three years and of the opponent’s goods for about ten years. Mr Johnson says that he is not aware of any confusion between the parties’ trade marks.
Mr Johnson states that he is not aware of any trader who manufactures both the goods made by the applicant and the goods made by the opponent.

Quick

Mr Quick is Managing Director of Quick Contracting (NSW) Pty Ltd, a company established by his father in 1952. Since 1991, Quick Contracting has had divisions in Melbourne and Sydney and Mr Quick is a member of the Standards Committee of Australian Standards. The committee sets the performance standards and preferred methods of installation for plumbers and builders.
Mr Quick’s company has been involved in some major contracts and is aware of the goods and trade marks of both parties. He states that he does not believe that there is any over lap between the parties’ goods.

Lockhart

Mr Lockhart appends to his declaration the results of an Internet search which shows that a number of retailers sell both tiles and bathware, bathroom furniture/baths/toilets, etc.

Martin

The Martin declaration shows that the retailers referred to in the Lockhart declaration sell sanitary ware and tiles which are made by different people. The exception is Villeroy & Boch. Villeroy and Boch, observes Ms Martin, make or market a wide range of house wares, in addition to sanitary wares, such as crockery and cutlery. Material supporting her contentions is exhibited to her declaration

Earp

Mr Earp is part owner, Sales and Marketing Manager of Earp Bother Hardware Pty Ltd. He states that he regularly visits architects and builders to promote his company’s products. His company supplies both tiles and ceramic sanitary ware and he observes that hardware stores, such as his firm and Bunnings, operate direct to consumers by retail of both sanitary ware and tiles.
Mr Earp’s company has sold the opponent’s goods under the trade mark JOHNSON since 1975 and, more recently, has sold a number of toilet suites bearing the opponent’s trade mark JOHNSON SUISSE. Mr Earp reports some confusion from his sales staff as to whether the two brands where related: this report is second-hand and it is significant that Mr Earp does not state that he was confused or deceived. I weight this report accordingly.
Mr Earp further states that he is aware of one company (in addition to Villeroy & Boch), RAK, based in the Middle East, that sells both ceramic tiles and ceramic sanitary ware to Prestige Tiles Pty Ltd in Australia. Information about Prestige Tiles from the Internet is exhibited to the Earp declaration.
I note now that the RAK sanitary ware and RAK tiles have different home pages subsidiary to RAK’s main home page within the RAK Internet site and that the goods are made in different factories.

Submissions

Submissions from the parties focussed on the grounds pursued at the hearing by the opponent: those under sections 41, 43, 44 and 60. The first two grounds look at the inherent qualities of the opposed trade mark and the grounds under section 44 and 60 look to effects and consequences of the comparisons of the parties’ trade marks.

Section 41

Section 41 provides a scheme for the assessment of the inherent fitness of a trade mark for registration as regards its inherent adaptation to distinguish the goods.
Subsection 41(2) of the Act provides that an application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant's goods from those of other traders. Subsection 41(3) provides that in deciding the question, the Registrar must first consider the extent to which the trade mark is inherently adapted to distinguish. If the Registrar finds the trade mark is to no extent inherently adapted to distinguish, then it is to be considered under the provisions of subsection 41(6). If the Registrar finds that the trade mark is to some extent inherently adapted to distinguish, but it is not capable of distinguishing on that basis alone, then it is to be considered under the provisions of subsection 41(5). If, after consideration under either the provisions of subsections 41(5) or 41(6), the Registrar is still not satisfied the trade mark is capable of distinguishing (41(5)), or does in fact distinguish (41(6)), then the application must be rejected.
Mr Lockhart submitted that the two words in the trade mark lack inherent adaptation to distinguish – the word JOHNSON being a common surname and the word SUISSE being the French or Swiss word for ‘Switzerland’ or for ‘Swiss’ and that the trade mark does not qualify for registration, because the evidence of its use is insufficient.
However, I find that I cannot agree with Mr Lockhart. The appropriate test lies in Clark Equipment Co v Registrar of Trade Marks (1964) 111 CLR 511, recently described as "probably the best known Australian authority on the notion conveyed by the phrase 'inherently adapted to distinguish'"[1]. Kitto J noted:
“... the question whether a mark is adapted to distinguish [is to] be tested by reference to the likelihood that other persons, trading in goods of the relevant kind and being actuated only by proper motives – in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess – will think of the word and want to use it in connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it”.
[1] Kenman Kandy Australia v Registrar of Trade Marks (2002) AIPC 91-817
The above test carries the implication that the assessment is somewhat more sophisticated than that suggested by Mr Lockhart. The trade mark is to be considered as a whole, rather than to consider the qualities of the separate words JOHNSON and SUISSE and to merge the two separate findings into one. Neither, however, is the trade mark one where two descriptive words contribute to a single meaning as might be, for example, the words SMOKED BACON used in relation to “processed meats”. Neither is the trade mark one where the words suggest that they might be considered separately and the effects of the considerations juxtaposed and balanced, such as might be the case with the example SMITH/BETTER. The trade mark is comprised of a surname and a word which qualifies that surname as being Swiss. In the context of the goods, this is most likely, I think, to be seen as denoting a Swiss individual, or company, with that surname who either makes the goods or is responsible for putting them onto the market.
The word JOHNSON does not immediately suggest itself as a common Swiss surname because it is an Anglo-Saxon surname. Presumably, there are not many people who might want or require to use the English surname JOHNSON in combination with the French or Swiss word SUISSE. Thus the words JOHNSON SUISSE do not lack inherent distinctiveness to the same degree as would, for example, the words JOHNSON ENGLAND or JOHNSON USA, or, indeed, the word JOHNSON on its own.[2]
[2] Some inherent adaptation is gained from the collocation of ‘weak’ trade mark material: Diamond T. Motor Co's Appn (1921) 38 RPC 373 (Ch.D.)
The trade mark is to be considered in the context of the goods and the likelihood that other manufacturers of similar goods will think of the words and want to use them on or in relation to those goods. There are not as many manufacturers of sanitary ware as there are, for example, of either clothing or foodstuffs. It is probable, then, that in the light of the test in Clark, above, that the words in trade mark do not lack inherent distinctiveness in relation to sanitary ware to the same degree as it would, for example, in relation to clothing or foodstuffs.
Thus, while I agree with Mr Lockhart that the trade mark JOHNSON SUISSE lacks inherent adaptation to distinguish, the lack which puts it within subsection 41(5) is not particularly severe. Many trade marks which fall into consideration within subsection 41(5) will have a greater or lesser lack of inherent adaptation and I consider that the words JOHNSON SUISSE, used in relation to ‘sanitary ware’ is one of a lesser scale.
The opponent also observes that the evidence demonstrates that the trade mark JOHNSON SUISSE is used in conjunction with other trade marks such as OXFORD, YALE or DERWENT. Thus, the use of the trade mark and its subsequent acquisition of distinctiveness might be eclipsed by the use of the other trade marks on the goods by the applicant. However, it is a commonplace now for traders to use a ‘house mark’ in respect of all of its goods and other trade marks as model designators and I am satisfied that the evidence shows that such is the case here. The use of the ‘model designator’ trade marks by the applicant does not, on the evidence before me, obscure, cloud or overshadow the use of the house mark in physical relation to the goods.
In regard to the use of its house mark, the applicant has attested to three years of use of the trade mark in relation to the goods before the priority date in Australia and I am satisfied that because of the combined effect of the extent to which the trade mark is inherently adapted to distinguish the designated goods or services and the use of the trade mark by the applicant that it does distinguish the goods of the applicant.
The opponent has not established its grounds in terms of section 41 of the Act.

Section 43

Section 43 provides
Trade mark likely to deceive or cause confusion
43. An application for the registration of a trade mark in respect of particular goods or services must be rejected if, because of some connotation that the trade mark or a sign contained in the trade mark has, the use of the trade mark in relation to those goods or services would be likely to deceive or cause confusion.
Mr Lockhart argued that the word SUISSE within the trade mark indicates that the goods are made in Switzerland whereas the evidence shows that they are not. However, I agree with Ms Champion that this ground is not well founded.
I consider that, in the context of this trade mark, the word SUISSE within the trade mark is likely to be seen as qualifying the word JOHNSON – rather than to been seen as referring to the goods in relation to which it is used. The trade mark is likely (as I have observed, above), to be seen as denoting a Swiss individual, or company, who either makes the goods or is responsible for putting them onto the market.
If the word SUISSE is to confuse or deceive, there must be some basis in the public perceptions of the use of the word and its connotations for that confusion or deception to occur. For example, the words, 'South Pole' could not be deceptive or confusing as to the origin of 'bananas' if used as a trade mark in relation to those goods as the South Pole is not renowned for its bananas and there is no public expectation that bananas might originate at the South Pole.
The word SUISSE might carry a certain cachet of quality or efficiency but it is not suggested in the opponent’s evidence that Switzerland has a particular reputation for the manufacture of sanitary ware. Thus, while the ground might have some merit if the goods were, for example, the chocolates for which the Swiss are renowned, I am satisfied that this is not the case here in relation to sanitary ware.
The opponent has not established this ground.

Section 44

Section 44 of the Act provides, relevant to these proceedings:
Identical etc. trade marks
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.
Note 1: For deceptively similar see section 10.
Note 2: For similar goods see subsection 14(1).
Note 3: For priority date see section 12.
(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.

I do not think that it was seriously contended at the hearing that the trade marks of the parties are not deceptively similar and, for completeness, I state that they are.[3] The trade mark registrations on which the opponent relies have earlier priority dates than does that of the opposed application. Accordingly, the question under subsection 44(1) is whether the goods of the parties are similar goods.
[3] See the test in Australian Woollen Mills Ltd v FS Walton & Co Ltd (1937) 58 CLR 641 and see, for example, George Ballantine & Sons Ltd v Ballantine Stewart & Co Ltd [1959] RPC 273 or Nettlefold Advertising Pty Ltd v Nettlefold Sings Pty Ltd (1997) 38 IPR 495.
The expression ‘similar goods’ is defined within section 14 of the Act

14 Definition of similar goods and similar services

(1) For the purposes of this Act, goods are similar to other goods:
(a)if they are the same as the other goods; or
(b)if they are of the same description as that of the other goods.

(2) For the purposes of this Act, services are similar to other services:
(a)if they are the same as the other services; or
(b)if they are of the same description as that of the other services.

What constitutes ‘goods of the same description’ has been the subject of considerable judicial comment. Recently, in McCormick & Company Inc v McCormick [2000] FCA 1335. Kenny J reviewed much of this at paragraph 17:
Whether the relevant goods are of the same description is essentially a question of fact.
The authorities establish that there are three principal factors to be considered in this regard. They are: (1) the nature of the goods, including their origin and characteristics; (2) the uses made of them, including their purpose; and (3) the trade channels through which the goods are bought and sold. As to the last-mentioned matter, it may be relevant to consider whether the goods being compared are produced by the same manufacturer or distributed through the same channels; whether they are sold in the same shops; whether they are sold to the same sort of customers; and whether those engaged in the manufacture and distribution of the goods are considered as belonging to the same trade: see In Re Jellinek's Application (1946) 63 RPC 59 at 70-72; In Re John Crowther & Sons (Milnsbridge) Ltd's Application (1948) 65 RPC 369 ("Crowther's Application") at 372; In Re Frank George Whiting's Application (1952) 69 RPC 219 at 221; and Reckitt & Colman (Australia) Ltd v Boden (1945) 70 CLR 84 at 94. As the High Court stated in Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 ("Southern Cross") at 606-607:
The fact that examination of the nature of the applicant's goods may, by itself, induce an observer to conclude that they are different in character from those of an opponent, and designed to serve different purposes, is by no means conclusive. Nor is the fact that the applicant's goods are not specified by the regulations as being within the same class of goods: see In re The Australian Wine Importers Ltd (1889) 41 Ch D 278, at p 291 and Reckitt & Colman (Australia) Ltd v Boden (1945) 70 CLR 84, at p 90 per Latham CJ. There may be many matters to be considered apart from the inherent character of the goods in respect of which the application is made and some indication of what matters are relevant to this inquiry was given by Romer J in In re Jellinek's Application (1946) 63 RPC 59. Romer J thought it necessary to look beyond the nature of the goods in question and to compare not only their respective uses but also to examine the trade channels through which the commodities in question were bought and sold. Shortly after the decision in Jellinek's Case the Assistant-Comptroller elaborated on the observations of Romer J in the following manner: `In arriving at a decision upon this issue the reported cases show that I have to take account of a number of factors, including in particular the nature and characteristics of the goods, their origin, their purpose, whether they are usually produced by one and the same manufacturer or distributed by the same wholesale houses, whether they are sold in the same shops over the same counters during the same seasons and to the same class or classes of customers, and whether by those engaged in their manufacture and distribution they are regarded as belonging to the same trade. In the case of Jellinek's Application ..., Romer J classified these various factors under three heads, viz., the nature of the goods, the uses thereof, and the trade channels through which they are bought and sold. No single consideration is conclusive in itself, and it has further been emphasized that the classifications contained in the schedules to the Trade Marks Rules are not a decisive criterion as to whether or not two sets of goods are "of the same description"': In re anApplication byJohn Crowther & Sons (Milnsbridge) Ltd (1948) 65 RPC 369, at p 372. Much the same considerations are evident in the observation of Dixon J (as he then was) in Reckitt & Colman (Australia) Ltd v Boden (1945) 70 CLR 84 when he said: `What forms the same description of goods must be discovered from a consideration of the course of trade or business. One factor is the use to which the two sets of goods are put. Another is whether they are commonly dealt with in the same course of trade or business. In the present case, the goods are quite different, their uses are widely separated and they are not commonly sold in the same kinds of shops or departments' (1945) 70 CLR, at p 94.
On the one hand, goods are not necessarily of the same description simply because they are sold for human consumption and in common trade channels: see, for example, In Re J & J Colman Ltd's Application (1929) 46 RPC 126, where mustard and semolina were held not to be goods of the same description. See also G Wood, Son & Co Ltd v McVitty & Co Pty Ltd (1964) 34 AOJP 2601 and In Re Chan Li Chai Medical Factory (HK) Ltd's Application (1990) 19 IPR 140 at 144. On the other hand, the expression "goods of the same description" is not construed restrictively and regard is paid to the commercial context in which the goods in question are bought and sold: see Rowntree plc v Rollbits Pty Ltd (1988) 10 IPR 539 at 546 and Dinning v New Balance Athletic Shoe Inc (1992) AIPC 38,719 at 38,725.
The goods in question here are, at their closest, ‘ceramic sanitary ware’ one the one hand, and ‘ceramic tiles’ on the other. Although the goods of the parties may be wider than this, my considerations are on this basis because, if these goods are not goods of the same description, then a fortiori, neither is the balance of the parties’ goods ‘goods of the same description’.
The evidence shows that these goods are made in different factories. While the opponent has pointed to RAK as a manufacturer who makes both, it is apparent from the Internet material in evidence about this company that its tile and sanitary ware operations are separate from each other and the materials about tiles and sanitary ware are on different subsidiary ‘homepages’ on the Internet. It is not clear from the RAK Internet material in evidence whether the goods are made in a coordinated manner to be sold together, or if they are goods which are (as they are made of the same material) coincidentally made by the one company.
I do not think that the evidence concerning use of the Villeroy & Boch trade mark on both tiles and sanitary ware signifies much. With the Villeroy & Boch trade mark appearing on such a disparate range of goods as toilets, crockery and cutlery, the fact that it appears on tiles and sanitary ware does not necessarily indicate that the goods are, or may be, similar goods. The use of the trade mark Villeroy & Boch is thus, perhaps, akin to a supermarket using its house brand on dissimilar goods such as semolina and mustard[4], herb teas and condiments[5] or olive oils and coffee[6].
[4] Re J & J Colman Ltd's Application (1929) 46 RPC 126 – goods not of the same description.
[5] Chan Li Chai Medical Factory (HK) Ltd’s Appn (1990) 19 IPR 406 – goods not of the same description.
[6] Cantarella Bros Pty Ltd v Novadelta-Comercio E Industria Des Cafes Lda (1998) 42 IPR 264 – goods not of the same description.
I turn now to the somewhat fraught question of the trade channels through which the goods of the parties come onto the market.
I consider that it is possible to make too much of the fact that the goods of both parties are, or may be, sold through departmental hardware stores such as Bunnings. It is possible to purchase anything from a masonry anchor to a circular saw in large departmental hardware stores. Obviously, however, circular saws and masonry anchors are not goods of the same description. Thus, the fact that goods such as are here in question are displayed and sold in large departmental hardware stores does not necessarily indicate that goods are of the same description. The evidence does not indicate whether, in such large departmental hardware stores, goods such as those of the parties are displayed and sold side-by-side at the same time to the same customer.
I think that it is fair to say that the evidence shows that most tiles are sold through specialist tile shops and that specialist tile shops do not sell sanitary ware. Most sanitary ware appears to be sold either from shops that specialise in sanitary ware or from plumber’s supply shops that display and sell sanitary ware to the public. There are occasional exceptions mentioned in the evidence – but I think that the evidence, considered as a whole, makes it plain that these exceptions are larger retail chains or suppliers where reservations similar to those I expressed about the departmental hardware stores may apply.
However, even in the larger retail chains, it appears to be unusual for those stores to sell tiles and sanitary ware made by the one manufacturer. The RAK example is the only obvious exception in Australia and these goods are seemingly only available through one retail chain (Prestige Tiles Pty Ltd).
The goods of the parties are of some expense: tiles, individually, are not a high cost item but the evidence shows it is usual for tiles to be sold in packs of twenty or twenty five and in total quantities of hundreds of tiles, or in large commercial projects, thousands. They are not a casual purchase and will be the subject of some investigation in a number of different locations. Often, they are purchased by, or in consultation with, designers, architects and/or project managers. Similarly, sanitary ware, or ‘suites’, are comparatively expensive and are bought after similar investigation and possibly with similar consultation.
Conversely, both tiles and sanitary ware are frequently used in the same environments – bathrooms and toilets – and ‘teamed’ to achieve a harmonious look or ‘design’. It is possible, I consider, to also make too much of this in the assessment of whether the goods are goods of the same description: carpets, paint and furniture are similarly selected for a design effect yet carpets, paint and furniture are patently not of the same description.
Ultimately, I do not think that the goods are goods of the same description: people engaged in different trades (tilers and plumbers) install tiles and sanitary ware and this is reflected in the usual distribution of tiles and sanitary ware. Tiles are usually distributed through tilers’ shops; sanitary wares are usually distributed through plumbers’ or bath wares shops. There are a few retailers who distribute both but this is more for the convenience of customers than because of a common origin in trade, a custom in trade or because of the dictates of a common supply chain. The same manufacturers do not normally make both sets of goods – out of all of the manufacturers in the world, the opponent has been able to point to one manufacturer who makes both sets of goods and sells them in Australia: the maker of these goods, however, makes them in different factories as treats them as being different goods by having different ‘homepages’ or sections which deal separately with each on its Internet site.
Further, the assessment of what constitutes ‘goods of the same description’ should be guided by what is the general rule as opposed to exceptions to the general rule such as are the RAK goods. This observation obviously applies with equal facility to whether or not the goods are both sold together in retail shops or wholesale suppliers. (I add the qualification that, as Ms Champion emphasised at the hearing, the opponent has not shown that the goods are displayed or sold side-by-side in departmental hardware stores, let alone sold at the same time to the same customer).
Accordingly, the goods are not goods of the same description and the opponent has not established its grounds in terms of section 44 of the Act.

Section 60

Section 60 of the Trade Marks Act 1995 provides:
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) 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.
Note 1:For deceptively similar see section 10.
Note 2:For priority date see section 12.
In order to establish a section 60 ground of opposition the opponent must establish that the applied-for trade mark is substantially identical with, or deceptively similar to another trade mark that enjoyed a reputation in Australia at the priority date of the applied-for mark and that as a result of that reputation, use of the applied-for trade mark would cause deception or confusion.
Accordingly, as the trade marks are deceptively similar, my consideration is of the extent of the reputation of the opponent’s trade marks at the priority date and the effects of this.
In McCormick & Company Inc v McCormick [2000] FCA 1335 (15 September 2000) Kenny J discussed ‘reputation’ at paragraph 81:
What is intended by the word "reputation" in s 60? The word is defined in The Macquarie Dictionary as follows:
reputation ... 1. the estimation in which a person or thing is held, esp. by
the community or the public generally; repute ... 2. favourable repute; good
name ... 3. A favourable and publicly recognised name or standing for merit,
achievement, etc. ... 4. The estimation or name of being, having done, etc,
something specified.
Cf. The Oxford English Dictionary. In s 60, the word is, I think, apt to refer to "the recognition of the McCormick & Co marks by the public generally".
The trade mark of the opponent undoubtedly has a reputation; however, this reputation probably varies amongst the class of customer who buys the opponent's goods.
The evidence before me suggests there are at least two distinct classes of customers who purchase the tiles of the opponent sold under the trade mark JOHNSON. The first is members of the public who are building or renovating their own home. The second class of customer is amongst those architects, builders, developers and so forth who in turn might employ designers or purchasers to buy or specify goods for their projects.
I consider that amongst the general public, the opponent’s trade mark may not have much of a reputation because the purchase of tiles by the public is not a frequent occurrence. Hence, the public’s exposure to the JOHNSON trade mark on tiles is infrequent – tiles are things that the public might buy only when building or renovating, something that might occur only two or three times in a lifetime. While the opponent’s trade mark appears on the rear of each tile, once the tile is affixed to the wall, this disappears from sight and, I suspect, memory. Thus, while the cost of tiling during renovation might exceed that of a gas cooking range or refrigerator, the trade mark on the tiles does not persist in the same way as those on domestic appliances. Hence, there does not appear to be much scope for an on-going recognition of the opponent’s trade mark amongst the public generally. There is no evidence from the general public and, absent evidence to the contrary, I am not satisfied that the opponent’s trade mark has a reputation amongst the public generally.
It is a different matter amongst professionals associated with the building trade who purchase or specify tiles for their projects on an on-going basis. Here, this section of the market is exposed repeatedly to the opponent’s trade mark and I am satisfied that the opponent’s trade mark has a reputation here.
The opponent has not shown that it is at all usual for tile manufacturers to diversify their product lines away from tiles. As I have observed, above, while discussing ‘goods of the same description’, there is only one manufacturer who sells both tiles and sanitary ware under the one trade mark in Australia and is would seem from the Internet material concerning this manufacturer that it treats these products as being separate and distinct from each other. Thus there does not seem to be any likelihood of brand extension[7] (or a market expectation of such) into sanitary ware by tile makers.
[7] As explained by Lehane J in McIlhenny Co v Blue Yonder Holdings Pty Ltd formerly trading as Tabasco Design & Anor [1997] 962 FCA (18 September 1997) (the Tabasco case).
The opponent has not shown that tile makers endorse sanitary ware or license the use of their trade marks on sanitary ware.
The section of the market amongst whom the reputation of the opponent’s trade mark exists must, I think, because of their knowledge of tile makers and their products and practices, know that there is no practice of brand extension or licensing by tile makers and that, usually, as far as the Australian market is concerned, tile makers only make tiles. This section of the market is used to dealing with what are, in reality, two separate and distinct sets of goods. This view is supported by the Quick declaration – Mr Quick, it will be recalled, is a member of the relevant Standards Committee of Australian Standards, whose company has divisions in both Melbourne and Sydney and says that ‘the goods have no over lap’. Mr Quick’s declaration strikes me as being balanced and non-partisan and of some weight.
Conversely, the only suggestion in evidence of confusion is of very low weight – it being a second-hand report of speculative chatter amongst sales staff from a declarant who does not state that he was confused.
The lack of any evidence of deception or confusion when the goods of the parties had, at the start of proceedings when this opposition was filed, been concurrently sold in Australia for some seven years, would strongly suggest to me that there is no deception or confusion and that it would be now unrealistic to expect that it might occur.
Thus, I do not consider that because of the reputation of the opponent’s trade mark, the use of the applicant’s trade mark would be likely to deceive or cause confusion.
The opponent has not established its ground under section 60.

Decision

Section 55 of the Act provides:

Decision

55. Unless the proceedings are discontinued or dismissed, 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.
Note: For limitations see section 6.

The opposition has not been established on any of the grounds it was argued. I note, for the sake of completeness, that those other grounds mentioned in the Notice of Opposition have also not been established.

Subject to the opponent notifying the Registrar of an appeal against my decision within one month of the date of this decision (before 19 May 2004), the application may proceed to registration, subject to my comments, below. If such appeal is notified and not withdrawn, the application should be dealt with as the Court directs.
If there is no appeal notified within one month (before 19 May 2004) to the Registrar or applicant, the applicant may apply within two weeks (before 2 June 2004) to amend the application by having the endorsement as to the provisions of section 44(3) removed from the application as, because of my decision under section 44, this endorsement may now be inappropriate.
If the applicant does not so apply within two weeks after one month from the date of this decision, the trade mark should be registered as it now stands.

Costs

Both applicant and opponent sought their costs should they be successful in these proceedings. Costs may follow the event and I order costs against the opponent at the official scale.

Ian Thompson

Hearing Officer

Trade Marks Hearings

19 April 2004