I Can't Believe It's Yogurt Ltd v Unilever Plc

[2001] ATMO 120

TRADE MARKS ACT 1995

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

Re:Opposition by I CAN'T BELIEVE IT'S YOGURT LTD. to registration of trade mark application 728010(29) - I CAN'T BELIEVE IT'S NOT BUTTER! - filed in the name of UNILEVER PLC.

Background

Trade mark application no. 728010 was filed on 14 February 1997, by Unilever Plc ("the applicant"). The application started life as a series application, for the trade marks I CAN'T BELIEVE..., I CAN'T BELIEVE IT'S NOT... and I CAN'T BELIEVE IT'S NOT BUTTER!, in class 29 of the International (Nice) Classification of Goods and Services, in respect of: "Margarine; edible oils and fats; all included in class 29"

Examination of the application was expedited, and the applicant was advised that the three trade marks applied for, being different in material particulars, did not qualify as a series within the meaning of the Trade Marks Act 1995 ("the Act"). The application was then amended to cover the single trade mark I CAN'T BELIEVE IT'S NOT BUTTER! Trade mark registration numbers 524664 and 524665, for the trade mark I CAN'T BELIEVE IT'S YOGURT for "frozen yogurt" and "restaurant services" were originally cited against the application, but subsequently withdrawn.

Following Hearing Officer Nancarrow's decision on the question of the mark's capacity to distinguish under section 41 of the Act, the trade mark was advertised accepted for registration in the Official Journal of Trade Marks on 4 September 1997, subject to the endorsement: "Provisions of subsection 41(5) applied".

On 4 March 1998, after obtaining a three month extension of time for the purpose, I Can't Believe It's Yogurt Ltd ("the opponent") filed a notice of opposition to registration of the trade mark. There were six grounds of opposition listed in the notice, challenging broadly across such issues as the trade mark's capacity to distinguish, the applicant's ownership of the trade mark, and whether its use would be contrary to law.

The opponent's evidence in support and the applicant's evidence in answer were duly filed and served. After the opponent formally indicated that it had decided not to file and serve evidence in reply, the applicant requested a hearing of the opposition. This came before me, as a delegate of the Registrar, in Sydney, on 26 October 2001. Mr Malcolm Farr, of Baldwin Shelston Waters, provided written submissions on behalf of the opponent. Mr Brian Elkington, of Blake Dawson Waldron, represented the applicant at the hearing.

Evidence

The evidence in support of the opposition comprises a statutory declaration by Mr Kevin Day, ("the Day declaration") Queensland State Manager and Export Manager of Everest Colonial Pty Ltd, dated 14 May 1998. This company is authorised by the opponent to use its trade mark I CAN'T BELIEVE IT'S YOGURT on "milk-based food products" for export from Australia to Malaysia and Singapore. Exhibits KD1 and KD2 are annexed to the declaration.

The evidence in answer is comprised of two statutory declarations by Ms Ayela Thilo, Corporate Counsel for Unilever Australia Limited, subsidiary of the applicant and licensed to use the trade mark in Australia. The first declaration ("Thilo 1") is dated 25 February 2000, and is accompanied by Annexures A to J. The second declaration ("Thilo 2") is dated 16 June 2000, and is accompanied by a single Annexure A.

Grounds and Submissions

Despite the broad sweep of claims in the notice of opposition, the opponent's written submissions were confined to grounds under section 44 of the Act. Mr Farr addressed the question of whether the applicant's trade mark I CAN'T BELIEVE IT'S NOT BUTTER! was deceptively similar, and the goods covered by it of the same description, as those covered by the opponent's prior trade mark registration number 524664. That registration is in respect of the trade mark I CAN'T BELIEVE IT'S YOGURT, in class 30 for "frozen yogurt". Its priority date is 2 October 1989.

Section 44

The relevant subsections (1) and (3) of Section 44 read as follows:

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.

Notional fair use

Mr Farr's first point was in relation to "notional fair use". This is particularly relevant to the opponent's situation, as the Day declaration attests to his company's manufacture of "milk based foodstuffs" in Australia and the application of the trade mark I CAN'T BELIEVE IT'S YOGURT to that product, all for export to Malaysia and Singapore. Mr Farr submitted that such use clearly satisfies the provisions of section 228 ("Use of a trade mark for export trade"). However, for the purposes of my consideration of whether the trade marks in question should be allowed co-exist on the Register, I should allow for notional fair use of the opponent's frozen yogurt side-by-side with the applicant's butter substitute at retail sale in Australia. This would be in accordance with the principle cited by Evershed J in Smith Hayden & Co Ltd's Application (1946) 63 RPC 97.

Mr Elkington did not dispute the opponent's claim in relation to this matter.

Similarity of the trade marks

Mr Farr then went on to consider the similarity between the trade marks in question. He did not suggest that I CAN'T BELIEVE IT'S NOT BUTTER! was substantially identical to I CAN'T BELIEVE IT'S YOGURT. However, he argued that the trade marks were deceptively similar, in accordance with the well-established tests set out by Windeyer J in The Shell Co of Australia Ltd v Esso Standard Oil (Australia) (1961) 109 CLR 407, at 414 - 415. Mr Farr stated that one of the major considerations in a determination of deceptive similarity is the application of the doctrine of "imperfect recollection" and the importance of first impressions. He argued that the trade marks in question have a substantial degree of visual similarity, both commencing with the phrase I CAN'T BELIEVE IT'S, and that this would be dominant in creating the first impression of each of the marks.

He further argued that, due to the inexpensive nature of butter substitutes and frozen yogurt, they would be purchased with "relative inattention", compared with the care with which ordinary people usually purchased luxury goods. This would cause, he said, the perceived similarity in first impressions to be all the closer, and the potential for deception and confusion all the greater.

Mr Farr then submitted that the "common idea" conveyed by the two trade marks was of considerable importance. He referred me to the exploration of this concept in Jafferjee v Scarlett (1937) 57 CLR 115, at 121 - 122. He said that both marks, by commencing with I CAN'T BELIEVE, clearly convey the same idea of strong disbelief. Both trade marks then conclude with the entirely descriptive and therefore forgettable words BUTTER and YOGURT. As far as the inclusion of the extra word NOT in the applicant's trade mark was concerned, Mr Farr drew my attention to the fact that this creates a "double negative". He surmised that I would likely be aware from my own experience as to the "confusion created by the mishandling of negatives". He also quoted from Fowler's Modern English Usage (2^nd edition, reissued 1996) at 384, which discusses the fact that, although it is generally accepted in English grammar today that two negatives cancel each other and produce an affirmative, this is by no means axiomatic. Fowlers says that in some other languages, such as Greek, negative symbols are multiplied to reinforce one another, so that a speaker "spreads as it were a thin layer of negative colouring over the whole of the sentence instead of confining it to one single place."

Mr Farr concluded on this point that:

The effect of the confusing double negative in the trade mark may thus in the minds of some persons hearing or seeing it be the opposite of that which is intended, namely it may be taken as if it were I CAN'T BELIEVE IT'S BUTTER! In this guise, the applicant's trade mark takes on exactly the same form as that of the opponent.

Mr Elkington took issue with both Mr Farr's contentions. He said that there were many obvious differences between the marks, and the ideas behind them. He commented that the opponent's mark had only one word - YOGURT - after the initial phrase and the applicant's mark had two words - NOT BUTTER. The final words in each mark were very different, both visually and aurally. Further, the ideas behind the marks were completely opposite. I CAN'T BELIEVE IT'S YOGURT imparting a straightforward "old idea" that the yogurt product in question tasted surprisingly unlike and, by implication, better than yogurt, while his client's mark I CAN'T BELIEVE IT'S NOT BUTTER! "astutely reversed" this idea. That mark conveyed, by a "clever twist", the idea that the applicant's vegetable oil based spread had many favourable qualities (eg less saturated fat, easier to spread) which made it an attractive alternative to butter. However, it was still so much like butter in taste and appearance that consumers would find it hard to believe that it actually wasn't butter.

Mr Elkington said that he believed the reference to Jafferjee v Scarlett (supra) was not especially relevant, as the trade marks in question there were two similar device marks, not word marks, capable of being read. Instead, he referred me to a much more recent case, C A Henschke & Co v Rosemount Estates Pty Ltd [1999] FCA 1561. This case deals with the trade marks HILL OF GRACE and HILL OF GOLD, both in respect of wines. Mr Elkington said the court had found in that case that the two marks were not deceptively similar, despite their common beginning, HILL OF G... because that portion of each mark channeled attention to the separately distinguishable words GRACE and GOLD. Similarly, I should find here that the opening phrase I CAN'T BELIEVE IT'S serves to focus attention on the unmistakably different endings, YOGURT and NOT BUTTER!

Similarity of the goods

Having argued that the two trade marks in question were deceptively similar, in terms of paragraph 44(1)(a) of the Act, Mr Farr moved on to the second requirement under that paragraph, that they be in respect of "similar goods or closely related services". He argued that, in accordance with the tests set down in Jellinek's Application (1946) (the "PANDA" case) 63 RPC 59, and extended in Beck Koller & Co Ltd's Application (1947) 64 RPC 76, the applicant's "margarines; edible oils and edible fats; all included in class 29" were certainly goods of the same description as the opponent's "frozen yogurt". Yogurt was a dairy product, while the applicant's goods substituted for dairy products. I would be aware, Mr Farr expected, that butter and butter-substitutes are always placed in close proximity on the shelves of supermarkets and corner stores, and very often in close proximity to other dairy products including yogurt. If not side-by-side, they were often in line of sight together. He submitted that such goods are typically distributed through the same channels at both wholesale and retail level and, if not produced by the same manufacturers, are often produced by manufacturers in competition. Further, he said, the similarity of the goods was reinforced by the nature of the trade marks. In both, the expression of disbelief gave the idea that both the applicant's and the opponent's products were somehow "healthy alternatives", and "this also would act to create a similarity in the consumers' minds between the respective product lines."

Mr Elkington responded on this point that, from his personal observations as a shopper for the family's groceries, the supermarket he frequented did not stock butter and yogurt side by side, but instead they were "a long way away from each other".

Honest concurrent use and other circumstances

Mr Farr then discussed whether, if the trade marks in question were deceptively similar, I may nevertheless find that the applicant's mark could be registered under the provisions of subsection 44(3), which allows for co-existence on the Register because of "honest concurrent use", or "other circumstances". He pointed out that it is accepted law in Australia, following Re "Granada" Trade Mark [1979] RPC 303 at 312, that only use of the applicant's trade mark prior to the date of filing of the application may be taken into account for the purposes of honest concurrent use. According to Thilo 1, use of the applicant's mark in Australia began in July 1997, that is, well after the filing date of 14 February 1997.

Lastly, Mr Farr examined the possibility that I may consider the (quite considerable) evidence of the applicant's use post filing for the purposes of establishing "other circumstances" in terms of paragraph 44(3)(b) of the Act. This approach has been taken in the past, for example, by Hearing Officer Homann in Dinning v New Balance Athletic Shoe Inc 1992 AIPC 90-931 at 38726. There Mr Homann remarked that, if he did not take the substantial evidence before him into account in this way, and instead refused the application, "the applicant could simply reapply and almost certainly obtain registration on the basis of extensive and concurrent use over the last eight years."

Mr Farr reminded me that the circumstances were different here, as the applicant's use was in domestic retail, while the opponent's was in export trade from Australia, and therefore such use could not be considered "concurrent". He referred me to Re "L'Amy" Trade Mark [1983] RPC 137, at 145. In this case, the fact that it had not been using its trade mark on goods of the same description as the applicant's (or, indeed, on any other goods) enabled an opponent to succeed against an applicant's claim to honest concurrent use of its own mark. Mr D. G. A. Myall held that:

In my opinion, however, the present application can derive no benefit from section 12(2) [of the UK Trade Marks Act 1938]. The opponents' mark that has to be considered under that subsection is not the one they have used but the one on the register. Since there is no evidence that that mark has ever been put into use, I do not think there can be said to have been any "concurrent use" at all. In my view that phrase means that the applicants' use must be concurrent with the opponents' use, not that the applicants' use has been concurrent with the opponents' registration. Even if the opponents' registered mark had been put into use it would not have been concurrent with the applicants' user since, on the opponents' evidence, the parties' goods have never been sold through the same trade channels; the word concurrent has not the same meaning as contemporaneous and is not, in my opinion, to be limited as if it did.

This reasoning has also been accepted in Australia, for example, see Medicon eG Chirurgiemechaniker-Genossenschaft v Medison Co Limited [2000] ATMO 12 (7 February 2000). Here, it represents a mirror-image approach to the opponent's earlier proposal that I take into account notional fair use of the mark in the Australian marketplace, to compensate for lack of actual use of the trade mark in Australia,

Mr Farr then turned his attention to the question of the honesty of use. He submitted that there was nothing in the applicant's evidence to attest to the applicant's honesty in adopting the trade mark I CAN'T BELIEVE IT'S NOT BUTTER! in Australia. Further, there was also nothing in either of the Thilo declarations to suggest that the applicant intended to continue to promote and sell goods under its trade mark beyond the time of the promotions in September 1997 and July 1999 referred to in the declarations. The grant of a registration, said Mr Farr, would "extend the applicant's statutory rights until at least February [2007] and, if the opponent's trade mark I CAN'T BELIEVE IT'S YOGURT [was] removed, might result in the opponent infringing a registration which may be of no real interest to the applicant." (Removal opposition proceedings are concurrently on foot between the parties.) Mr Farr acknowledged that the Hearing Officer may wish, in this instance, to have regard to for example, "his own general knowledge" and "circumstances which his own enquiries show to prevail in a particular trade or place" (Prosimmon Golf (Aust) Pty Ltd v Dunlop Australia Ltd (1987) 9 IPR 425). However, he counselled against too liberal an application of this principle. He said, "the Hearing Officer is not given licence to conjecture, and must otherwise base his decision on a proper assessment of the available evidence." In the circumstances, a finding by me of the application's entitlement to registration on the basis of "other circumstances" would not be warranted by the evidence, and would therefore be "potentially dangerous".

Mr Farr concluded his submissions by asking for an award of costs to the opponent in this matter.

Mr Elkington's response to the suggestion that the applicant may not intend to continue using its trade mark, was that the opponent was "clutching at straws" because patently, the applicant's goods were still on the supermarket shelves. To read anything into the circumstance that the last indication of use in the evidence was 1999 was simply "silly", as all this observation reflected was the fact that the declaration in question was made some time ago, in February 2000.

Mr Elkington made further brief submissions in response to the other grounds raised by the opponent in the Notice of Opposition. However, as the opponent did not rely on those other grounds for the purposes of the hearing, I do not propose to elaborate on the submissions here. Mr Elkington then concluded by requesting costs on behalf of his client, the applicant.

Discussion

This opposition stands or falls on the single issue of whether the applicant's trade mark I CAN'T BELIEVE IT'S NOT BUTTER! is deceptively similar to the opponent's prior trade mark registration for I CAN'T BELIEVE IT'S YOGURT, in terms of section 44 of the Act. There are three aspects to a finding that an application must be rejected (or, in opposition, refused) because of the existence of another trade mark. The other trade mark must have an earlier priority date than the application. In the present case, the priority date of the opponent's trade mark registration is 2 October 1989, whereas the applicant's priority date is 14 February 1997. Then, the marks must be either substantially identical (which has not been argued at all in this opposition) or deceptively similar. Finally, the goods/services covered by the trade marks in question must be similar goods or closely related services.

The tests for deceptive similarity are different from those for substantial identity. They invoke much more subtle comparisons of the whole impressions given by each trade mark being compared. Often, too, consideration of whether two marks are of themselves deceptively similar in look, sound or idea, will overlap into consideration of how and where the marks are actually used. The words of Dixon and McTiernan JJ in Australian Woollen Mills Ltd v F.S.Walton & Co Ltd (1937) 58 CLR 641, at page 658 give valuable guidance:

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 effect of spoken description must be considered. If a mark is in fact or from its nature likely to be the source of some name or verbal description by which buyers will express their desire to have the goods, their similarities both of sound and of meaning may play an important part. 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 observation of men considered in the mass affords the standard. Evidence of actual cases of deception, if forthcoming, is of great weight.

Weighing up both the opponent's and the applicant's submissions on the question of deceptive similarity of the marks, there is some merit on both sides. The expression of surprise I CAN'T BELIEVE is very strong, and undoubtedly creates a powerful and similar idea in each mark that may, alone and in the "right" circumstances, cause confusion. However, the expression is not alone in either trade mark. In one, it is followed by IT'S NOT BUTTER! In the other, by IT'S YOGURT. These words are so dissimilar, even though descriptive, that they militate against purchasers' imperfect recollection that could likely occur, were the pairs of marks I CAN'T BELIEVE IT'S NOT BUTTER v I CAN'T BELIEVE IT'S BUTTER, or I CAN'T BELIEVE IT'S YOGURT v I CAN'T BELIEVE IT'S NOT YOGURT instead. Having come to a pause because of the dissimilarities of the words BUTTER and YOGURT, the purchaser would then be all the more likely to differentiate, through the generally negative colouring of both phrases, the further distinguishing double negative in the applicant's trade mark.

Turning then to the products that the trade marks are applied to, I also find that I cannot accept that the goods are of the same description. In Jellinek's Application (supra), Romer J set out the following primary criteria for determining whether goods are of the same description. He compared:

• The nature of the goods

• The respective uses of the articles

• The trade channels through which the commodities are respectively bought and sold.

In the present case, it may be that yogurt is a dairy product, and the applicant's goods are dairy product substitutes, and even that they are both sold in supermarkets, but there the similarity ends. The opponent's product is frozen yogurt. Its closest cousin in terms of a dairy product substitute would be whipped ice-confection, not margarine. "Healthy alternatives" in their own separate product ranges or not, frozen yogurt and margarine are in no sense substitutes for each other. I believe that the possibility is already slim that an "ordinary" but distracted person may rush into a supermarket, looking for a bucket of chilled yogurt in the refrigerator section, and come out by mistake with a packet of margarine, even if both were placed in line of sight. The likelihood of such confusion ever occurring between a dessert product from the freezer section and a butter substitute from the refrigerator is, in my view, negligible.

Hearing Officer Thompson's comments in Levi Strauss & Co v Harson International Limited [1999] ATMO 126 (22 December 1999) were quoted to me by Mr Farr. These referred to findings in LANCER Trade Mark Application [1987] RPC 303, that

...the more expensive an item to be purchased, the greater the care that was usually exercised in the purchase by ordinary people. Conversely, with inexpensive items, the less time and attention the ordinary person gives to the consideration of the purchase.

I agree that the first part of this observation is demonstrably applicable to purchasers of expensive cars, such as were the subjects of the LANCER case (supra). Certainly, people do take extra care when a great deal of money is at stake. But people also take care in purchasing where, although a comparatively insignificant cost is involved, the practical consequences of their mistake may still significantly inconvenience them. Such inconvenience would be the result for anyone mistaking frozen yogurt for margarine (or vice versa) on his or her shopping list. Both these items may be food, but their nature and purposes, even as dairy and dairy substitute food, are completely different. One will not do when the other is required.

Given the significant differences I have discussed between the relevant trade marks themselves, and between the goods to which they are applied, I believe that the applicant's trade mark passes the tests set by subsection 44(1) of the Act. No "evidence of actual cases of deception" (to return to the final comment of Dixon and McTiernan JJ, quoted above) has been forthcoming to disturb this view, which is scarcely surprising given the opponent's lack of actual use of its trade mark in this country. Finding that subsection 44(1) does not apply, I am not required to inquire further into the aspersions cast by the opponent onto the applicant's possible case for acceptance under paragraphs 44(3)(a) or (b).

Decision

I have found that the opposition has failed on the single ground pursued by the opponent at the hearing. As mentioned above, Mr Elkington made submissions on behalf of the applicant in response to other grounds raised in the Notice of Opposition. For completeness, and as I have no other basis to be satisfied that any of them have been made out, I find each of these grounds has also failed. I now dismiss the opposition in its entirety and direct that the application may proceed to registration after 30 days from the date of this decision, subject to the payment of the appropriate fee. If the Registrar has been served with a notice of appeal before that time, I direct that registration shall not occur until the appeal has been decided or discontinued.

Costs

Both sides have claimed costs in this opposition. I award costs, according to the official scale, against the unsuccessful opponent, I Can't Believe It's Yogurt Ltd.

Claudia Murray
Hearing Officer

29 November 2001