Houzz Inc v Uhomzz Network Technology Co Ltd

[2019] ATMO 31

TRADE MARKS ACT 1995

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

Re:Opposition by Houzz, Inc. to registration of trade mark application 1730701 (9, 35, 36, 39, 41, 43) – U UHOUZZ (Figurative) - in the name Uhomzz Network Technology Co., Ltd

Delegate:

Nicholas Smith

Representation:

Opponent: Davis Collison Cave Pty Ltd

Applicant: Wilma Kim

Decision:

2019 ATMO 31

Trade Marks Act 1995 (Cth) - Section 52 opposition: s 60 considered – ground established – registration refused

Background

1.  This is an opposition brought by Houzz, Inc. (‘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 Uhomzz Network Technology Co., Ltd (‘Applicant’). 

Application Number:

1730701

Filing Date:

27 October 2015

Goods and Services:

Class 9: Computer software (recorded); Computer programs (downloadable software); Computer software applications (downloadable); Computer programmes (programs), recorded; Computer peripheral devices; Laptop computers; Electronic publications (downloadable); Global positioning system (GPS) apparatus; Electronic book readers; Audiovisual teaching apparatus; Telescopes; Switches, electric; Theft prevention installations, electric; Batteries, electric; Animated cartoons

Class 35: Online advertising on a computer network; Presentation of goods on communication media, for retail purposes; Advertising; Outsourcing services (business assistance); Commercial administration of the licensing of the goods and services of others; Business management consultancy; Business information; Commercial intermediation services; Providing business information via a web site; Provision of an on-line marketplace for buyers and sellers of goods and services; Auctioneering; Marketing; Import-export agencies; Personnel management consultancy; Systemization of information into computer databases

Class 36: Real estate agencies; Provision of information relating to real estate; Leasing of real estate; Real estate advisory services; Brokerage of real estate; Accommodation bureaux (apartments); Rental of apartments; Insurance consultancy; Financing services; Loans (financing); Credit card services; Providing financial information via a web site; Art appraisal; Brokerage; Guarantees; Charitable fund raising; Trusteeship; Lending against security; Instalment loans; Real estate valuations

Class 39: Sightseeing (tourism); Booking of seats for travel; Travel reservation; Personal tour guide services; Providing driving directions for travel purposes; Transport; Packaging of goods; Car rental; Storage; Distribution of energy; Courier services (messages or merchandise); Escorting of travellers; Provision of travel information; Services for the arranging of tours

Class 41: Teaching; Academies (education); Education information; Vocational guidance (education or training advice); Organisation of competitions (education or entertainment); Arranging and conducting of workshops (training); Arranging and conducting of conferences; Providing online electronic publications (not downloadable); Publication of electronic books and journals online; Publication of books; Game services provided online (from a computer network); Videotaping; Language interpreter services; Ticket agency services (entertainment); Provision of tuition; Coaching (training); Tutoring

Class 43: Hotel reservations; Reservation of temporary accommodation; Bar services; Tea room services; Accommodation reservation services; Rental of temporary accommodation; Hotels; Accommodation bureaux (hotels, boarding houses); Cafes; Tourist homes; Retirement homes; Rental of transportable buildings; Accommodation letting agency services (holiday apartments); Boarding house bookings; Rental of furniture

(collectively ‘Applicant’s Goods and Services’)

Trade Mark:

(‘Trade Mark’)

Endorsements:

The applicant has advised that the CHINESE characters appearing in the trade mark may be transliterated as YI XIANG HAO JU which may be translated into English as GOOD HOME IN A FOREIGN LAND.

1. Following the examination process, the application’s acceptance for possible registration was advertised on 22 September 2016 in the Australian Official Journal of Trade Marks.  The Opponent filed a Notice of Intention to Oppose on 22 November 2016.  The Opponent then filed a Statement of Grounds and Particulars (‘SGP’) on 22 December 2016. The SGP raised grounds of opposition under ss 42(b), 44, 58A, 60 and 62A of the Act. The Applicant filed a Notice of Intention to Defend on 6 February 2017.

   Evidence and Submissions

   3.  Following the issuing and expiry of a Cooling-Off period, the Opponent filed Evidence in Support of its opposition (‘EIS’) on 13 February 2018.  This evidence consists of a declaration made on 13 February 2018 by Anthony Been, Country Operations Manager - Australia of the Opponent, with Exhibits AB-1 to AB-46 (‘Been Declaration’) and a declaration made on 12 February 2018 by Nicholas Patrick Butera, Trade Marks Attorney at Davies Collison Cave Pty Ltd, the Opponent’s representatives, with Exhibits NPB-1 to NPB-21 (‘Butera Declaration’).  The Applicant did not file any evidence in answer.

2. Once the time allowed for filing evidence had ended the parties were given an opportunity to request a hearing or to file written submissions.  On 2 July 2018 the Opponent requested an oral hearing.  The matter was set down for a hearing in Canberra on 6 February 2019 and the matter was allocated to me.  In line with usual practice, an email was sent to the parties on 7 December 2018 which contained a schedule for the provision of written summaries of submissions to be filed prior to the hearing.  The Opponent filed written submissions on 23 January 2019 (‘Opponent’s Submissions’) and indicated that in the absence of any submissions or indications that the Applicant would attend the oral hearing, did not intend to attend in the oral hearing.  The Applicant did not file any submissions or participate in the hearing in any way.

3. 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 on the basis of the written record, comprised of the materials mentioned in the preceding paragraphs:

   (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.

   The Opponent

   6.  The Opponent is a Delaware corporation incorporated in 2008 and operates an online platform for home remodelling/renovation, architecture, interior design and decorating, landscaping and home improvement industries, from a number of websites but chiefly from and (in Australia) (‘Houzz platform’) accessible online and via an app (‘Houzz app’).  The Opponent is, amongst other marks, the owner of the trade marks listed in the table below (‘Opponent’s Trade Marks’).  The services for which the Opponent’s Trade Marks are registered are collectively referred to as the (‘Opponent’s Services’). 

Number	Trade Mark	Priority Date	Goods
1467823	HOUZZ (‘Houzz Mark’)	8 Jul 2011	Class 35: Promoting home design and decorating products of others by providing hypertext links to the web sites of others; promoting home design, decorating, and remodelling services of others by providing contact information and hypertext links and service provider's websites; Class 37: Provision of information on a website in the field of home renovation and remodelling; Class 42: Providing a website featuring information in the field of interior design and architecture for use by interior designers and architects; providing a website featuring information in the field of home interior design and interior decorating; providing an website that features temporary use of non-downloadable software allowing website users to upload, post, share and display online photos of interior design and decorating ideas and which also allows users to post questions and comments in the field of interior design, decorating and remodelling; providing a website featuring temporary use of non-downloadable software for use in creating online, electronic scrapbooks of design and decorating ideas;
1598388	23 Jul 2013	Class 35: Providing online directories and listings featuring vendor contact information in the field of interior decorating, furnishings, and remodeling; Class 37: Providing online directories and listings featuring vendor contact information in the field of interior decorating, furnishings, and remodeling; Class 38: Providing hypertext links to websites of others featuring the sale of furnishings; providing hypertext links to websites of others featuring home remodeling information; providing hypertext links to websites of others featuring interior decorating information; Class 42: Providing information in the field of interior decorating and architecture via a website; providing temporary use of non-downloadable software allowing website users to upload, post, share and display online photos of interior decorating ideas and that also allows users to post questions and comments in the field of interior decorating and remodeling via a website; providing temporary use of non-downloadable software for use in creating online, electronic scrapbooks of decorating ideas via a website;

1. The Been Declaration contains the claims/statements set out below. 

   ·     The Opponent’s Houzz platform allows home design enthusiasts and professionals to share and download images of products, projects, discuss trends, obtain inspiration, promote their business and purchase products displayed on the platform.  Home owners use the Houzz platform to generate ideas and seek inspiration, while professionals use the Houzz platform as a means of attracting customers and showcasing their work.  

   ·     The Houzz platform was launched in 2009 and as of 2017 was used by more than 40 million homeowners, hosted 1.5 million listings and contained over 14 million photographs.  The Houzz platform and all services offered by the Opponent are offered by reference to the Opponent’s Trade Marks.

   ·     Australians have used the Houzz platform since it was launched in 2009.  The Opponent launched an Australian-focused website and app in 2014.  At that time over 700,000 Australian homeowners used the Houzz platform and over 10,000 Australian home improvement professionals maintained listings on the Houzz platform.  At the date of the declaration, the Houzz platform is used by more than 1.5 million Australian users per month and includes listings for over 46,000 Australian home improvement professionals.  

   ·     The Opponent maintains a number of social media accounts under the Houzz Mark that promote its platform, including a Facebook account, Twitter account (that as of 2017 had over 5,000 Australian followers) and an Instagram account (that as of 2017 had over 79,000 Australian followers).

   ·     The Opponent has a number of partnerships with Australian companies, associations, educational institutions and organisations in the design and renovation industry.

   ·     The Opponent has successfully opposed the registration of a number of applications made by the Applicant to register ‘-houzz’ trade marks in China.[1]

   [1] In the Opponent’s Submissions, the Opponent also refers to a decision made by the Intellectual Property Office of New Zealand to refuse to register the Trade Mark in New Zealand.

2. The Butera Declaration contains the evidence set out below. 

   ·     The Butera Declaration provides a very significant number of articles from 2010 to the relevant date in mainstream Australian media reporting on the Opponent and the services it offers from the Houzz platform.

   ·     The Butera Declaration provides information as to the use of the Houzz app, indicating that a certain points in time the Houzz app for iPhone was the 33rd most downloaded app in the Australian App Store and the second most downloaded ‘Lifestyle App’, with similar figures being provided in respect of the Houzz app for iPad and Houzz app for Google Play. 

   ·     The Butera Declaration sets out versions of the Houzz platform in Australia from before the relevant date.  

   The Applicant

   9.  The Applicant has provided no evidence and as such, I have no information about the applicant other than what has been provided in the EIS and is available through the Trade Marks Register.  

   Grounds of Opposition, Onus and Standard of Proof

   10. As indicated above in the SGP the Opponent nominated grounds of opposition under ss 42(b), 44, 58A, 60 and 62A of the Act, though in its submissions it indicates that it no longer pursues the ground of opposition pursuant to s 58A of the Act. To successfully oppose the application the Opponent needs to establish at least one of the abovenamed grounds. As will become apparent, the Opponent has successfully established a ground of opposition pursuant to s 60. Consequently, it is unnecessary that I consider the remaining grounds. Of course, should this decision be appealed, it would remain open to the Opponent to plead any ground available to it under the Act in proceedings before the Court.

3. The onus of proof in an opposition rests upon the Opponent.[2]  The relevant standard of proof is the ordinary civil standard based on the balance of probabilities.[3]  The date at which the rights of the parties are to be determined is 27 October 2015 (‘relevant date’), being the filing date of the application in Australia (except in circumstances, not present here in which a different priority date is provided for in the Act).[4]

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

   [3] 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].

   [4] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, 595, see also s 29(1) Trade Marks Act 1995 (Cth).

   Discussion

   Section 60

   12. 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.

4. 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.[5] 

   [5] 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.

5. 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’.[6]  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 …[7]

   [6] [2000] FCA 1335, [81].

   [7] (1992) 33 FCR 302, 343.

6. 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.[8]

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

7. 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[9] 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.[10]

   [9] (2000) 50 IPR 1.

   [10] 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].

8. 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.[11]

   [11] Mark Davison, Shanahan’s Australian Law of Trade Marks and Passing Off Online Westlaw AU, [50.2415] <

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

   The Opponent has, and as at the Priority Date had, a significant reputation in its HOUZZ Trade Marks[12] as a result of the extensive use and promotion of those marks by the Opponent, its subsidiaries and its authorised users, as well as third party media outlets, in relation to the Opponent's Goods and Services[13]. The Opponent's reputation derives from the continuous and expansive use and significant promotion of the HOUZZ Trade Marks internationally since 2009, and in Australia since at least as early as August 2014, in relation to the Opponent's Goods and Services.

   As a result, the use of the Applicant's Trade Mark for the goods and services specified in the Application would be likely to cause confusion (including initial interest confusion).

   [12] defined as the Opponent’s Trade Marks in this decision.

   [13] defined in the SGP as ‘interior and exterior design and decorating, remodelling, architecture, landscaping, home furnishings and accessories information and advisory services, photo sharing software (including nondownloadable software), website hosting, scrapbooking (including electronic scrapbooking), online marketplace and directory services for home design, building and landscape professionals, online retail services, and related goods and services.’

1. The EIS demonstrates the considerable reputation of the Opponent’s Trade Marks and in particular the Houzz Mark as of the relevant date.  As of the relevant date the Houzz Platform, which trades under the Houzz Mark, had been used by 700,000 Australian homeowners (with a significant proportion of those users being regular monthly active users) and 10,000 Australian home improvement professionals, was a leading app in the ‘lifestyle’ category of the App Store® (and similarly on Google Play) and had been discussed in or was the subject of numerous articles in mainstream media across Australia.  While the use of the Houzz platform had not been particularly longstanding, nor has their been considerable advertising (the Opponent relying more on free media, social media and word of mouth), given the significant usage of the Houzz platform by Australians by the relevant date, I am satisfied that at the relevant date both the Opponent’s Trade Marks and in particular the Houzz Mark was likely to have acquired a considerable reputation for services relating to the offering of a home improvement platform and directory. 

2. It is not sufficient that the Opponent merely establishes that its trade mark has a reputation. I must also be satisfied that because of that reputation 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 the 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.[14]

   [14] (1937) 58 CLR 641, 658.

3. The concepts of ‘deceive’ and ‘confuse’ were explained in the New Zealand case of Pioneer Hi-Bred Corn Co v Hyline Chicks Pty Ltd, where Richardson J said:

   ‘Deceived’ implies the creation of an incorrect belief or mental impression and ‘causing confusion’ may go no further than perplexing or mixing up the minds of the purchasing public. Where the deception or confusion alleged is as to the source of the goods, deceived is equivalent to being misled into thinking that the goods bearing the applicant's mark come from some other source and confused to being caused to wonder whether that might not be the case.[15]

   [15] [1979] RPC 410, 423 (citations omitted).

4. It is well established that the kind of confusion contemplated by s 60 need not lead to actual purchase of the goods or services covered by the impugned trade mark. As Heerey J put it in Nettlefold Advertising Pty Ltd v Nettlefold Signs Pty Ltd:

   A probability of confusion, if it is real, is sufficient even though the confusion may be unlikely to persist up to the point of, and be a factor in, inducing actual sales. There may be confusion or deception in the minds of persons to whom the mark is addressed, even if actual purchasers will not ultimately be deceived.[16]

   [16] (1997) 38 IPR 495, 501(citations omitted). His Honour’s remarks were made in the context of s 28 of the Trade Marks Act 1955, but are applicable to s 60 of the Act.

5. In Registrar of Trade Marks v Woolworths 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.[17]

   [17] [1999] FCA 1020, [50]. These considerations by French J are a restatement of the principles set out by Kitto J in Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, 594-5.

6. 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.[18]

   [18] [2012] ATMO 124 at [40].

7. 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.’[19]

   [19] [2016] FCA 729 at [142].

   26.       In the present case the Trade Mark and Houzz Mark share the common and distinctive element ‘Houzz’.  I accept the Opponent’s submissions that the majority of the Australian population cannot read the Chinese-language symbols in the Trade Mark and are thus likely to discount them as unintelligible for the purposes of comparison.  Furthermore to the extent Australian consumers can read the Chinese-language symbols, their meaning, being ‘good home in a foreign land’ does not necessarily reduce the likelihood of confusion with the Opponent, since the Houzz Platform relates to home design and renovations. 

   27.       I also note that the Applicant’s Goods and Services include a wide variety of goods and services that are potentially similar or closely related to the services for which the Houzz Mark has acquired a reputation, including computer software, electronic publications, advertising, providing business information via a web-site and real estate advisory services.

   28.       Given the reputation of the Houzz Mark, the similarity between the marks and the nexus between the services that the Houzz Mark has a reputation in and a subset of the Applicant’s Goods and Services, I consider it likely that consumers familiar with the Houzz Trade Mark would see the Trade Mark used for the Applicant’s Goods and Services and be caused to wonder whether it might not be the case that goods and services bearing the Houzz Mark and goods bearing the Trade Mark come from the same source.

   29. I find that because of the reputation acquired by the Houzz Mark the use of the Trade Mark in connection with the Applicant’s Goods and Services would be likely to deceive or cause confusion. I find that the Opponent established the ground of opposition pursuant to s 60 of the Act.

   Decision

   30. I have found the Opponent has established the ground of opposition it raised pursuant to s 60 of the Act. As the Delegate of the Registrar I accordingly refuse to register the Trade Mark. I direct that the refusal be recorded one month from the date of this decision. If the Registrar is served with a notice of appeal before that time, I direct that the refusal shall not occur until the appeal has been withdrawn or discontinued. Otherwise the disposition of this application should be in accordance with the Court’s orders or directions.

   Costs

   31. The Opponent 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 Applicant 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

   6 March 2019