Intermatch Sweden Aktiebolag v Dick Smith Investments Pty Ltd

[2003] ATMO 18

TRADE MARKS ACT 1995

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

Re:Opposition by INTERMATCH SWEDEN AKTIEBOLAG to registration of trade mark application 819436 (34) - DICKHEADS AND DEVICE - filed in the name of DICK SMITH INVESTMENTS PTY LTD.

DATE OF DECISION:

24 March 2003

DELEGATE:

Hearing Officer Claudia Murray

REPRESENTATION:

Opponent

F B Rice & Co, Patent and Trade Marks Attorneys

DECISION:

1. Section 52 Opposition: registration allowed - s 55(b)

2. Costs awarded against opponent

Background

Dick Smith Investments Pty Ltd (the applicant) filed trade mark application no. 819436 on 10 January 2000. The subject of the application is the trade mark:

The application was filed in class 34 of the International (Nice) Classification of Goods and Services, for "matches". No grounds of rejection under the Trade Marks Act 1995 (the Act) were raised against the application during examination. Advertisement of its acceptance for registration was advertised in the Australian Official Journal of Trade Marks on 5 October 2000.

On 5 February 2001, after obtaining an extension of time to do so, Intermatch Sweden Aktiebolag (the opponent) filed notice of opposition to registration of the trade mark. Fourteeen grounds of opposition were listed in the notice.

Filing and service of the opponent's evidence in support and the applicant's evidence in answer was completed by 5 August 2002. However, after that date, no evidence in reply was forthcoming from the opponent, and neither side elected to be heard upon the opposition when invited to do so by the Registrar of Trade Marks. The matter has now come before me, as a delegate of the Registrar, to determine by reference to the evidence.

Evidence

Evidence in support

The opponent's primary evidence in support of its opposition comprises a statutory declaration by Michael Lawrence, dated 24 October 2001. Mr Lawrence is the Managing Director of Swedish Match Australia Pty Ltd, a wholly owned Australian subsidiary of the Swedish opponent company. Mr Lawrence explains that the trade mark REDHEADS was coined in 1946 by the Australian company Bryant and May Pty Ltd. It was first used in relation to matches, and was used on a label incorporating a picture of a woman's head, with red hair and red lips. The first REDHEADS word and device trade mark, numbered 87739, was registered in 1946. Its original image has been updated, as can be seen below. Registered trade mark number 354736, also shown below, shows a more modern version again of the red-headed woman. It is registered in respect of "Matches made in Australia".

87739  354736

Mr Lawrence also explained that ownership of all the REDHEADS trade marks changed from Bryant and May Pty Ltd to the opponent in 1998. It owns a total of thirteen trade marks featuring either the word REDHEADS alone, or together with the device of a woman's head. Of these, I have reproduced in the following table details for the six that cover goods, in classes 34, 11 and 4, which are similar to the applicant's goods:

TM No	Trade Mark	Class	Filing Date	Statement of Goods
87739	REDHEADS and DEVICE (see above)	34	3 July 1946	Matches
289371	REDHEADS	34	5 Aug 1975	Smokers' articles including liquid or gas fuel lighters, excluding matches
354736	REDHEADS and DEVICE (see above)	34	17 Dec 1980	Matches made in Australia
386757	REDHEADS	34	27 Jan 1983	Raw and manufactured tobacco including cigarettes, cigars and smoking tobacco included in this class
289372	REDHEADS	11	5 Aug 1975	Gas ignition devices for cooking purposes in Class 11
301734	REDHEADS	4	1 Nov 1976	Fuel, firewood, firelighters, firestarters, barbecue fuels and starters of any description not including mechanical or electrical starters decorative and imitation firelogs and fuel for use as fuel all being goods included in Class 4

Mr Lawrence declares that he believes the applicant's trade mark is a "direct copy" of the REDHEADS label. He says:

While it may be flattering to have competitors copying essential features of a famous trade mark, such copying may well lead to dilution of the value of the famous mark and unjustly misappropriates the reputation established by the owner of the famous mark. Recognition of such copyists should not be given by way of a trade mark registration.

Exhibits ML-1 to ML-6, being mainly examples of the trade marks in use on packaging, accompany Mr Lawrence's declaration. Exhibit ML-6 comprises several taped interviews conducted (in January 2001) by comperes of various radio stations with Dick Smith, founder of the applicant company and well known to the Australian public as a high-profile businessman, aviator and adventurer.

The second part of the opponent's evidence in support is made up of seven declarations made by members of the public attesting to the veracity of their answers to attached copies of a questionnaire. The questionnaire has been designed by the opponent's earlier agents, Freehills Carter Smith Beadle, and focuses on customers' familiarity with the REDHEADS trade mark, and ability to recall distinguishing features (notably the red colouring) of packaging associated with it.

Evidence in answer

The applicant's evidence in answer comprises a declaration by Philip Andrew Murrell, dated 2 August 2002, and accompanied by Exhibits A-1 to A-4. Mr Murrell is Financial Controller of Dick Smith Investments Pty Limited (the applicant) and Dick Smith Foods Pty Ltd. Mr Murrell responds briefly in his declaration to all the grounds raised in the opponent's notice of opposition. He argues that the trade marks in question are not deceptively similar, and that in any case the manner of presentation of the applicant's goods is such that no deception or confusion of the public is likely. He points to the fact that the display cartons for the applicant's goods are specifically marked with the words "No, not Redheads, genuine Dickheads". He says, "If it were our intention to mislead the consumer into believing Dickheads were in fact Redheads, we would not promote the product by specifically stating the contrary." Exhibit A-1 to Mr Murrell's declaration shows that the following words also appear on the packets of matches themselves:

We would have to be complete dickheads to let most of our famous Australian brands be taken over by foreign companies. Brands such as Vegemite, Aeroplane Jelly, Arnott's, Speedo and Redhead Matches are in overseas hands. This means the profit and wealth created goes overseas and robs our children and grandchildren of a future. A protest from Dick Smith Foods "As Australian as you can get".

Mr Murrell responds to a reference by Mr Lawrence to Dick Smith's description on radio of how he "copied" his trade mark from REDHEADS packaging (Paragraph 11 and Exhibit ML-6). Mr Murrell explains:

Whilst Dick is happy to concede that he did copy the concept of the packaging from Redheads, he goes on to say that careful measures were taken to make the Dickheads packaging significantly different from Redheads packaging. The interviews also state the obvious, that is, that no Australian consumer could possibly mistake Dickheads for Redheads.

Mr Murrell concludes that he is not aware of any deception or confusion of the public having occurred, even though the applicant's and the opponent's goods have co-existed in the marketplace for some time. He says the opponent's claim that the public could ever be confused between the two products "obviously underestimates the common sense and intelligence of Australian consumers."

Grounds of opposition

As I have explained above, I have no submissions before me to indicate which of the numerous grounds of opposition originally listed in the opponent's notice it might have wished to press, had the matter proceeded to a hearing. However, based upon the evidence before me, which relates to deception and confusion, I will proceed to consider the opponent's case in terms of sections 42, 43, 44 and 60.

Section 42 - use of trade mark contrary to law

Subsection 42(b) of the Act provides:

An application for the registration of a trade mark must be rejected if:

...

(b) its use would be contrary to law.

Madjwick J's findings in Advantage-Rent-A-Car Inc v Advantage Car Rental Pty Ltd [2001] FCA 683 clarify the responsibilities of the Registrar of Trade Marks in considering whether the use of a trade mark would be contrary to laws other than the Trade Marks Act 1995. At paragraph 28, Madgwick J said:

I acknowledge the claim made by counsel for the Registrar that such an approach requires the Registrar to look at questions of law outside his or her expertise and that this can be difficult and may place a large and onerous responsibility upon the Registrar. However, the Registrar has the comfort that the criterion is that the use "would" not "could" be contrary to law...It should also be noted that what is required is that the Registrar form a view as to whether the use of a trade mark would be contrary to law.

Section 52 of the Trade Practices Act 1974 deals with misleading or deceptive conduct. Subsection 52(1) states:

(1) A corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

D R Shanahan, in Australian Law of Trade Marks and Passing Off, 1990, at page 456, says "Misleading conduct does not merely cause confusion; it actually directs a person towards the wrong choice". There is no evidence before me that the applicant's use of its trade mark either has, or is likely to, mislead or deceive members of the public in this way. (In fact, given the present manner in which it is using the mark, as described by Mr Murrell, the applicant is apparently going to some lengths to avoid the possibility of any such occurrence.)

In terms of section 42, I cannot be satisfied that the applicant's use of its trade mark would be contrary to the trade practices legislation, or indeed to any other law. The opposition has therefore not succeeded on this ground.

Section 43 - Trade mark likely to deceive or cause confusion

Section 43 of the Act provides:

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.

The word "connotation" in section 43 refers to a message which a person might infer from a trade mark, deriving from an inherent signification in a word or device, as opposed to any trade mark signification that may be attached to it. Section 43 is intended to protect the public from the registration of trade marks with connotations that might lead purchasers to make a reasonable, but incorrect, assumption about a product, which could not easily be confirmed or discounted by even close inspection of that product. (For example, see the VITAMIN and ORLWOOLA cases, J. Kitchen & Sons Pty LTD v Inman (1939) 9 AOJP 1383 (Reg.), and Re Trade Mark "Orlwoola" (1909) 26 RPC 850 (C.A.).)

The Full Federal Court recently discussed the function of section 43, in Big Country Developments Pty Ltdv TGI Friday's Inc, [2000] FCA 720, 48 IPR 513 at 521. Wilcox, Kiefel and Emmett JJ said:

The case on deception and confusion sought to be made by Big Country and Friday's Australia in the present proceedings is one that falls outside the reasons specified in [section 43]. It does not depend upon some connotation in the registered mark, but upon its similarity to a name used by Big Country and others. So the alleged deception or confusion is not for a reason covered by s 43.

Similarly, in this case any deception and confusion of the purchasing public alleged by the opponent would not originate from a connotation within the applicant's mark itself, but from its supposed similarity to the opponent's trade marks. Accordingly, I find that a ground of opposition under section 43 has not been made out.

Section 44 - substantially identical or deceptively similar trade marks

Subsection 44(1) provides:

(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.

The definition of "deceptively similar" in section 10 is that "a trade mark is taken to be deceptively similar to another trade mark if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion". Subsection 14(1) provides that goods are similar to other goods if they are the same as, or of the same description as, those other goods. Section 12 states that the priority date for the registration of a trade mark is either its date of registration or, if the trade mark is not yet registered, the day that would be its date of registration, if it were registered.

There is no dispute raised in the evidence of either party relating to whether or not the priority dates of opponent's trade mark registrations precede that of the applicant, (10 January 2000), or whether the goods in question are similar goods. Taking these criteria set out in section 44 as satisfied, the issues to be decided here are whether the applicant and the opponent's trade marks (listed earlier in table form) are either substantially identical, or deceptively similar.

A very well known test for substantial identity between trade marks is set out by Windeyer J in Shell Co. (Aust) Ltd v Esso Standard Oil (Aust) Ltd (1961) 109 CLR 407, at page 415:

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 dissimilarity that emerges from the comparison. "The identification of an essential feature depends", it has been said, "partly on the Court's own judgment and partly on the burden of the evidence that is placed before it": de Cordova v. Vick Chemical Co. (1951) 68 RPC 103, at p 106.

A side-by-side comparison of the applicant's DICKHEADS and woman's head device trade mark with either the opponent's trade mark REDHEADS alone, or REDHEADS together with the device of a woman's head, cannot help but result in a finding that the marks are dissimilar. The words DICKHEADS and REDHEADS are visually very different, and the devices also have many observable differences. I find that the trade marks in question are not substantially identical.

The tests for deceptive similarity are considerably more subtle than those applied for substantial identity, although no less practical. Dixon and McTiernan JJ in Australian Woollen Mills Ltd v F.S.Walton & Co Ltd (1937) 58 CLR 641, at page 658 say:

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.

This test was written at a time when trade marks legislation required the applicant to bear the onus, both in examination and opposition proceedings, of demonstrating that its trade mark qualified for registration. That onus has shifted under the Trade Marks Act 1995. Lahore, Patents, Trade Marks and Related Rights (2001), says at paragraph 66,320:

Under the 1955 Act it was well established that in opposition proceedings the onus of proof lay with the applicant. The opponent needed only to establish that there were matters for the applicant to answer. (Re Appn by Karachi Aerosol Co Ltd(1985) 6 IPR 33 at 34; Camelot Design Industries Group Pty Ltd v Bernard Leser Publications Pty Ltd(1987) 9 IPR 596 at 598.) A “reversed” onus of proof operates under the 1995 Act. The applicant is entitled to acceptance unless grounds for opposition are established — “[t]he onus is on the opponent to convince the registrar of the validity of the grounds of opposition that they have cited." (Trade Marks Office Draft Manual of Practice and Procedure, Part 46.)

Registrar of Trade Marks v Woolworths Limited 45 IPR 411 explored some of the implications for trade mark owners of this reversal of onus. French, J put the point succinctly: "the probability of deception and confusion must be finite and non-trivial" (paragraph 43).

For the purposes of the present DICKHEADS application, the opponent's success under section 44 depends upon its ability to persuade me that ordinary members of the public are in real danger of confusing the applicant's trade mark with those of the opponent. The applicant has made much of what it sees as the absurdity of such a claim and, applying the tests discussed above, I have to agree. Trade marks, even those which also contain devices, are usually best known by the words they contain. The words REDHEADS and DICKHEADS are different visually and aurally, and perhaps most strikingly, in meaning. The Macquarie Dictionary 3^rd Edition (2000) defines "redhead" as "a person having red hair", and "dickhead" as being a colloquial term for "a fool; idiot". Both these words, in the context of the trade marks they either partially or wholly comprise, also have secondary meanings which would be apparent to many potential customers. REDHEADS refers to the red tops of the opponent's matches, and DICKHEADS is a play on Dick Smith's name. These factors would combine, I believe, to powerfully differentiate the word components of the respective trade marks, even in the minds of those exceptionally careless or stupid people Dixon and McTiernan JJ suggest need not be considered when testing for deceptive similarity.

The opponent has argued that the applicant has directly copied its device of a woman's head. While it is true that both parties' word and device trade marks portray a woman's head, there the similarity ends. The REDHEADS device depicts a woman glancing seductively over her shoulder through luxuriant hair. By contrast, the DICKHEADS device shows a woman with very prim and tidy hair. She has apparently been shocked or affronted by something (the implication being that this is connected to use of the expression DICKHEADS) which she has just heard. Her mouth is open and she has her hands over her ears. The different images of the women therefore serve to reinforce the respective, very different meanings of the words REDHEADS and DICKHEADS.

In Sports Cafe Ltd v Registrar of Trade Marks [1998] 1614 FCA (18 December 1998), Wilcox, Heerey and Lindgren JJ said, at page 5:

The fact that two marks convey a common idea becomes relevant only if the marks themselves look and sound alike. Commonality of idea might then tip the balance in favour of a finding that the likeness is deceptive.

In that case, trade marks which shared the common words SPORTS CAFE, but each contained other material, were compared and found not to be deceptively similar. Here, the trade marks in question contain words that neither look nor sound alike, and have quite different meanings. And although each trade mark contains a device of a woman's head, the differences between those heads militate against any finding that this constitutes a "common idea" between them.

The DICKHEADS trade mark application and the REDHEADS device trade mark registrations are not subject to any colour restriction. This means that their use is not limited to any specific colours, and my assessment of whether the trade marks are substantially identical or deceptively similar must account for possible use by the parties in any colour of their choosing. I mention this, however, because Mr Lawrence's declaration emphasises that the opponent always depicts the woman in its trade mark with red hair, and it believes its use of red colouring on its packaging overall is an important identifier for its goods. He argues that the applicant, by also using its trade mark with a red background (although the woman's hair is contrasted in black) in a parody of his company's trade mark, has compounded what he believes to be the similarity between the marks.

Mr Smith has made no secret of the derivation of his trade mark. Indeed, his protest message would have little impact, were not that derivation sufficiently apparent to potential consumers. The opponent has protested in turn that the value of its trade marks may have been diluted by such "misappropriation". If it was available, "evidence of actual cases of deception", as suggested by Dixon and McTiernan JJ, might have assisted the opponent's case here, as it might also have assisted its case in terms of section 42. However, no such evidence has been forthcoming. The evidence from the seven declarants who answered the opponent's questionnaire may have been intended to serve this purpose, but the picture painted by the declarants' responses is so vague and incomplete that the evidence as a whole falls very far short of the mark.

To conclude, I find that use of the applicant's trade mark on matches, in the face of the opponent's use of its trade marks on similar goods, would not result in deception or confusion of the public. Accordingly, the opponent's ground of opposition under section 44 has not succeeded.

Section 60 - trade mark with a reputation in Australia

Section 60 provides:

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.

To satisfy section 60, an opponent must demonstrate that, at the time of filing of the opposed application, it had a reputation in a substantially identical or deceptively similar trade mark, such that use of the applicant's trade mark would likely cause the public to be deceived or confused. Unlike section 44, under section 60, the trade mark(s) to be relied upon by the opponent do not need to be the subject of an application for registration, or to be registered. However, in common with section 44, they must still meet the tests of being either substantially identical or deceptively similar to the applicant's trade mark. I have already found that the trade marks in question are neither substantially identical nor deceptively similar. The opponent's case in terms of section 60 has therefore failed to clear the first hurdle and cannot succeed.

Decision

I find that the opposition has not succeeded under any of the grounds discussed above. For completeness, and as I have no basis to be satisfied that the other grounds raised in the notice of opposition, but not addressed in the opponent's evidence, have been made out, I find each of those grounds to be also unsuccessful. I direct that the application may proceed to registration one month from the date of this decision. 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

The opponent has sought its costs in this matter. However, it is usual for costs to follow the event, and I see no reason here to deviate from that course. I award costs, according to the official scale, against the unsuccessful opponent, Intermatch Sweden Aktiebolag.

Claudia Murray

Hearing Officer

Trade Marks Hearings

24 March 2003