Hung's (1985) Ltd v D & J Fowler Ltd

[1992] ATMO 58

trade marks act 1955

decision of a delegate of the registrar of trade marks

Re:Opposition by D.& J. FOWLER LIMITED to Trade Mark Application Nos. 479710 and 479711 in the name of HUNG'S (1985) LIMITED

Application numbers 479710 and 479711 were lodged on 15 January 1988 in the name of HUNG'S (1985) LIMITED (the applicant).  These applications, for the mark shown below, were advertised in the Official Journal of 10 August 1989 for, respectively, "Coffee, tea, cocoa, sugar, rice, tapioca, sago, artificial coffee; flour and preparations made from cereals, bread, pastry and confectionery, ices; honey, treacle; yeast, baking-powder; salt, mustard; vinegar, sauces (except salad dressings); spices; ice" in Class 30, and "Meat, fish, poultry and game; meat extracts; preserved, dried and cooked fruits and vegetables; jellies, jams; eggs, milk and milk products; edible oils and fats; salad dressings; preserves," in Class 29.

On 26 October 1989, notice of opposition to the marks' registration was lodged by D.& J. FOWLER LIMITED (the opponent).  The grounds of the opposition were based on sections 28, 33 and 40.  The opponent alleged that use of the mark by the applicant would lead to confusion and deception due to the goodwill accrued by the use of the opponent's numerous registrations of LION word and device marks for goods of the same general description, and that the applicant was not the proprietor of the mark.

The opponent lodged part evidence in support on 24 October 1990 and the balance on 9 May 1991.  The applicant lodged its evidence in answer on 22 November 1991.  The opponent's evidence in reply was then lodged on 19 February 1992.

On 19 May 1992, the opponent requested that a hearing be set down to decide the matter and the cases came before me as the Registrar's delegate in Canberra on 13 August 1992.  Representing the opponent were Mr Howard Schulz and Dr Mark Horsburgh of Collison & Co, Adelaide, while appearing for the applicant was Ms Annette Freeman of Spruson & Ferguson, Sydney.

As a means of efficiently dealing with both sides of the argument, I propose to briefly summarise the evidence relied upon by both parties which was lodged prior to the hearing and then the submissions advanced by the attorneys in prosecuting their clients' cases.

Opponent's evidence in support
The first part of this consists of the declaration of Mr Deuter, who is the Chief Executive of the opponent company.  He declares that his company is the proprietor of numerous trade marks consisting of the device of a lion and the words LION or LION BRAND, the earliest of which was registered from 2 July 1906.  Attached as exhibits are details of the marks, material which describes the history of the opponent and its marks, details of sales and advertising figures in relation to the marks, samples and photographs of the company's advertising material, samples of packaging showing the marks in use and declarations from persons in the trade attesting to use of the opponent's marks.

The balance of the evidence comprises a declaration by Margaret Truscott, who is employed as the Director of the Market Facts Divisions of McGregor Marketing.  She states that she conducted a survey to establish to what extent the opponent's LION word and device mark was recognised by the public of Australia.  The exhibits attached to her declaration comprise a representation of the mark which was the subject of the survey and the results of the survey in booklet form.  It would seem appropriate here to include that representation in this decision - see below:

Applicant's evidence in answer
This consists of a declaration by Peter Hak-Hip Hung, a Director of the applicant company.  He declares that the mark has been used by the applicant's licensee in Australia since 1984 in respect of edible oils and fats.  He lists sales figures in Australia since 1986 and amounts spent on advertising under the mark since that year.  Attached as exhibits are examples of the mark in use and copies of the advertisements featuring the mark placed in various print media.
Opponent's evidence in reply
This comprises a declaration by John Anthony Messina, the Financial Accountant of the opponent company, in which he describes the history of the present opposition from the opponent's viewpoint.

The hearing
Dr Horsburgh, for the opponent, first submitted that his client had developed a reputation for its mark in Australia with over 100 years' use.  He contended that this reputation was so widespread that use of the word LION and any device of a representation of the animal for the goods involved would be attributed to his client.  This meant that the opponent was the proprietor of the words LION BRAND and the device of a LION in these classes, and the inclusion of other material, as in the case of the applicant's mark, did not alter this situation.  He said that the combination of the opponent's long history of the use of its LION marks and consequent reputation, and its large number of registered LION marks established a case under s.40.

With regard to the opposition based on s.33, he said that there was a direct correspondence between the goods of the subject marks and those of the opponent's prior registrations, all being, in general terms, grocery items.  On the question as to whether the marks were identical or deceptively similar, he said that notional use of all marks should be considered.  Brand awareness played a large part in purchasing groceries and shoppers might quickly choose a LION brand product, assuming it to be their usual selection.  Upon discovering the error, the shopper would probably not return the item because the low unit price would make such an action uneconomical.  When referring to a composite word and device mark, customers were more likely to refer to it by the word in the mark - Golden Crumpet Co Australasia v Hardings Manufacturers Pty Ltd (1987) 8 IPR 147. This, he said, would be the case in the present instance. The buying public would refer to both of the marks as LION marks and confusion would occur. A trade mark may be infringed by another trader if it used one or more of its elements in connection with its own goods - de Cordova v Vick Chemical Co (1951) 68 RPC 103. He further referred to Jafferjee v Scarlett (1937) 57 CLR 115 regarding the "idea" of the marks - the "idea" in the present instances being a lion.

Dr Horsburgh then referred to the survey conducted by McGregor Marketing which, he said, showed that there was high spontaneous awareness of LION brand products being attributed to the opponent by the public, any goods bearing a lion implying such a connection.  He said that the trade declarations included with the survey established that LION marks were known throughout Australia as having a connection with the applicant.  Mr Schulz also addressed the present state of the Register regarding LION marks, commenting that a large proportion of those marks already belonged to the opponent and those that did not were sufficiently differentiated or obscure to preclude confusion.

Turning to the objection based on s.28, Dr Horsburgh said that, since the decision of Hearing Officer Homann in Titan Manufacturing Co v John Terrence Coyne 22 IPR 613, the Office has taken the view that paragraphs (a) and (d) of that section should be read conjunctively - that is, in addition to proving deception and confusion by use of the mark, some blameworthy conduct should be shown on the part of the applicant. He said that the decision in Titan had left open the question as to whether a lack of bona fide intention to use the mark was sufficient to support an allegation of misconduct.  In the present instance, that blameworthy conduct lay in the applicant's lack of intention to use the mark as applied for.  The mark was not used on all the goods and, when used, the device portion was used on its own or with the LION and GLOBE devices separated.  He later referred to what he alleged was use of a cartoon LION device by the applicant which he said was similar to other marks owned the opponent.  The question of whether the present mark was likely to deceive or cause confusion was a combination of the widespread reputation of the opponent's mark borne out by its long and extensive use, substantial sales and advertising, the trade declarations and the results of the McGregor survey which pointed to the opponent having a wide reputation in LION marks being recognised as its "house" marks.

Ms Freeman, in reply, first addressed the question of the objection raised under section 40.  She said that the opponent could not claim to be the proprietor of the applicant's mark as it was first used in China and then Hong Kong since the 1930s, and then adopted in good faith and used in Australia since 1984.  It was a different mark from the opponent's LION marks, containing not just a LION device but also a GLOBE device, the words LION & GLOBE BRAND, and Chinese characters.  She said that the basis of a claim to proprietorship is found in the combined effect of authorship, intention to use and application for registration.  Here she referred to Shell Co (Aust) v Rohm and Haas Co (1948) 78 CLR 601. The opponent could only claim rights in its marks as registered and it did not own all the LION marks on the Register in the Classes applied for or, indeed, the present mark.

With respect to the objection in relation to section 33, Ms Freeman agreed that the goods claimed by the applicant and those of the opponent's registered marks were the same or of the same general description.  The applicant had already used its mark in Australia on edible oils and fats, the particular goods of interest.  However, there would be no confusion if both the applicant's and opponent's marks existed side by side on the Register for all the goods claimed, as the marks were not deceptively similar.  She said that Mr Deuter had asserted in his declaration that confusion and deception would be likely to occur, but no instances had been listed, especially in the light of the present mark's use since 1984.  She referred to Parker J's "rules of comparison" in Pianotist Co's Appn (1906) 23 RPC 774 at 777 as the authoritive statement for the purposes of the comparison of marks for s.33 purposes. In the present instance, the LION devices were different, and the present mark had additional features which distinguished it from those of the opponent. She disagreed that the applicant's mark would be known as a LION mark, given the other equally prominent features of the GLOBE device, the words LION & GLOBE BRAND and the Chinese characters. In any case, it was disputed that the opponent had any monopoly of the word or device of a LION in relation to grocery products. She drew my attention here to the number of co-existing marks on the Register which included a LION device, either on its own or with other distinguishing features, in Classes 29 and 30.

With respect to the opponent's evidence, Ms Freeman referred to the declarations from people in the trade relied on by the opponent to show its reputation and claim possible confusion if the marks co-existed.  She alleged these contained leading questions and neglected the crucial question of whether the marks were confusingly similar, and were therefore of limited probative value.  Here she referred to Fox & Co's Appn (1920) 37 RPC 37 regarding the weight a tribunal should give to such evidence.

With respect to the McGregor survey, Ms Freeman said that, while survey evidence was admissible, it should be closely examined and generally treated with caution - Customglass Boats Ltd v Salthouse Bros Ltd (1976) RPC 589. In the present case, she alleged numerous shortcomings, including some weighting in the survey, leading and loaded questions, and the fact that the respondents were never shown a copy of the applicant's mark as they were that of the opponent's.

Turning to the objection under s.28, Ms Freeman said that it had not been shown that confusion between the marks would occur.  They had been used concurrently since 1984 with no listed instances of confusion.  The mark had first been adopted and used overseas on a wide range of goods, and then in Australia in good faith, albeit not on all of the goods claimed.  However, no adverse conclusions should be drawn from that.  She said that the applicant was not attempting to benefit from the reputation of the opponent.  The mark applied for was a composite mark and was quite different from the LION mark of the opponent.  The opponent did not have a registration for a GLOBE device, the words LION AND GLOBE BRAND, or even for the words LION BRAND alone.  Certainly, there had not been any blameworthy conduct shown on behalf of the applicant, something that was now necessary to establish in addition to deception and confusion, ensuing from use of the mark.

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

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 opponent is the owner of a well known mark which has achieved a wide reputation throughout Australia and especially in South Australia.  This is supported by the opponent's evidence.  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 Shell case, supra, 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...

When the applicant's and opponent's marks are placed side by side, the differences become quite apparent.  The applicant's mark comprises the device of a lion on its hind legs resting its front paws on a large globe.  Beneath this is some oriental script and the English words LION & GLOBE BRAND.  On the other hand, the opponent's primary mark - the version used for the McGregor survey - comprises a line drawing of the silhouette of a lion on all fours (or passant to use the heraldic term) above a shield device on which is the word LION.  Other marks owned by the opponent in the pertinent classes include a similar mark to its principal one with the words FOWLER'S LION BRAND, a realistic looking lion device with the words LION BRAND, and the device of a laughing cartoon lion.  Thus, it is obvious that the marks are not substantially identical to the mark at issue.
I think that the question of whether the applicant's mark is deceptively similar to the opponent's marks is the matter of greatest contention.  Sub-section 6(3) defines a mark as deceptively similar if it is likely to deceive or cause confusion.  To determine this, 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 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.

The opponent's case in this regard rests, in my opinion, on whether a person would carry away the impression of a LION mark from both its own and the applicant's marks, and be deceived or confused into thinking that both marks had common ownership.  However, I am far from convinced that any inferences of ownership of the opponent's LION marks would include the applicant's mark.  In the face of the finding in  de Cordova v Vick Chemical Co, supra, referred to by Dr Horsburgh, there are other marks on the Register in classes 29 and 30 which include lions, albeit with other material.  In the applicant's mark, the lion is included with the device of a globe in almost equal proportion.  This combination is emphasised by the words LION & GLOBE BRAND.  The further visual dimension of Chinese characters is another aspect which, in my opinion, would differentiate it from the opponent's mark.  Here I must agree with Ms Freeman that the mark would be more likely to be referred to as the LION AND GLOBE mark.

I am satisfied that the McGregor survey was correctly administered and recorded.  However, I feel that some interpretations of the results in the prosecution of the opponent's case go beyond what could be construed as logical conclusions.  The respondents in the survey were only asked about their perception of LION marks, not those with equally competing elements.  They were not shown the applicant's mark and asked for their opinions regarding its ownership.  That omission is, in my opinion, a crucial flaw in the opponent's argument where it relies on the declarations and survey.  It is also drawing a long bow to construe, as Dr Horsburgh would have me do that, if 74.7% of respondents would assume a connection with the same company if they saw a LION logo and the word LION on grocery items, then the applicants mark - with its additional features - would be considered such a case.  I therefore do not agree that the mark could be considered by the purchasing public to be deceptively similar to the opponent's marks.

For the foregoing reasons I find that there is no objection to the applicant's mark under s.33 of the Act.

Section 28
Section 28 of the Act reads 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;

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

shall not be registered as a trade mark.

The initial test to be applied under s.28 may be stated as it was enunciated by Evershed J in Smith Hayden & Co Ltd's Appn (1946) 63 RPC 97 where he said:

Having regard to the reputation acquired by the name 'Hovis', is the court satisfied that the mark applied for, if used in a normal or fair manner in connection with any goods covered by the registration proposed, will not be reasonably likely to cause deception and confusion amongst a substantial number of persons?

I have no doubt that the reputation enjoyed by the opponent for its marks, particularly the primary mark referred to in the declarations and survey, is long-lived and widespread.  Certainly, the declarations attached to the Deuter declaration show an awareness of the opponent's mark throughout Australia (but more particularly in South Australia).  The McGregor survey shows a high awareness of the mark for grocery items in Adelaide and, to a lesser extent, Perth.  The case in Sydney is, however, far from convincing where only 19.4% of respondents associated any LION logo with grocery items compared with 89% for Adelaide and 69.8% for Perth.  The number of respondents who knew the actual owner of the opponent's mark was low - 16.7% in Adelaide, 18.9% in Perth and none at all in Sydney.  Nevertheless, I am willing to concede that a reasonable degree of awareness exists of the opponent's mark, its association with grocery items and the opponent's ownership of it - albeit with some unevenness in perception.  However, in relation to whether purchasers of the grocery items covered by both marks would suffer deception or confusion when confronted with the marks, I am of the opinion that they would easily distinguish them.  The only common features in the applicant's mark and the opponent's primary mark are the devices of a LION and the words LION and BRAND.  However, the present mark has other equally prominent material and I do not consider that the public would see the marks as having a common origin.  It follows that a substantial number of persons would not be deceived or confused by the present mark's normal and fair use on grocery items in the same market place as the applicant's goods now appear.

Notwithstanding the above, as Dr Horsburgh observed, the Office now follows the decision of Hearing Officer Homann in the Titan decision, supra, in requiring that paras (a) and (d) of s.28 be read together.  This means that, had I found that the marks were likely to deceive or cause confusion, then it would also have been necessary to find whether there had been blameworthy conduct on the part of the applicant to disentitle the marks to the protection of a court of law.  I cannot agree that the opponent has made a case of such conduct by the applicant.  The opponent has claimed that the applicant is not using the mark as applied for on the packaging for its goods and in advertising.  However, the examples of the mark in use included as part of the applicant's evidence in answer show use of all the essential features of the mark albeit with some juxtaposition of the device, English words and Chinese characters.  There would appear to be no attempt on the part of the applicant to use the mark in any fashion which could be construed as deceptive or misleading.  Dr Horsburgh's claim that some blameworthy conduct lies in the applicant's alleged lack of intention to use the mark on all of the goods claimed can be answered, I think, by the fact that the applicant has lodged a statement as to use, or intention to use, and I must, prima facie, accept that as the case unless it is shown by evidence not to be so.  With respect to the claim that the applicant is using a cartoon LION mark in the market place which is similar to one of the opponent's marks, I must observe that it is not the mark which is the subject of this decision.  Any remedy sought in that direction would be a matter for a court of competent jurisdiction to determine and is not a matter which should be decided by the Registrar.

I must therefore find in relation to s.28 that the mark is not deceptive or confusing and is not disentitled to protection in a court of justice.  Accordingly, the opposition fails on this ground.

Section 40
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. Here, the respective marks are overall different in appearance and the question of proprietorship does not arise.

On the issue of proprietorship of the present mark, therefore, I find that, even though the opponent has demonstrated use of its LION marks in respect of the relevant goods 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.

Conclusion

I find that the opposition has failed on all grounds and is dismissed.  Subject to any appeal from this decision, the applications should now proceed to registration.  I award costs in the matter to the applicant.

Ian Forno
Hearing Officer

23 September 1992