Intuit Inc v Cadcam Computer Design Pty Ltd

[2011] ATMO 50

TRADE MARKS ACT 1995

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

Re:Opposition by Intuit Inc to registration of trade mark application 1203904(35) - MRS QUICK BOOKS - filed in the name of Cadcam Computer Design Pty Ltd.

Delegate:

Iain Thompson

Representation:

Opponent: Kate Beattie of Counsel instructed by Davies Collison Cave

Applicant: Malcolm Bell of Phillips Ormonde & Fitzpatrick

Decision:

2011 ATMO 50

S52 opposition – s60 – because of reputation of opponent’s trade mark, use of opposed trade mark by applicant likely to deceive.

Registration refused

Background

1. In this matter CADCAM Computer Design Australia Pty Ltd (‘CADCAM’) of Albert Park, Melbourne, has applied to register a trade mark, current details of which appear below:

Application No:        1203904

Priority Date:            18 October 2007

Services:Class 35: Accounting; business accounts management; business consultancy; computerised business records keeping

Trade Mark:              

(‘the opposed trade mark’)

1. The application was examined in compliance with section 31 of the Trade Marks Act 1995 (‘the Act’) and accepted for possible registration.  It was advertised as such in the Australian Official Journal of Trade Marks on 21 February 2011.

2. On 19 June 2008, after seeking and receiving an extension of time in which to do so, Intuit Inc, (‘the opponent’) of Mountain View, California, filed Notice of Opposition (‘the Notice’) to the registration of the trade mark. The Notice cites most of the grounds of opposition available under the Act including those which were subsequently argued before me at a hearing of the matter in Melbourne on 7 March 2011. For the sake of completeness, I find that the grounds mentioned in the Notice other that those argued at the hearing are not established by the opponent.

3. At the hearing, Malcolm Bell of Phillips Ormonde & Fitzpatrick represented CADCAM.  Kate Beattie of Counsel instructed by Davies Collison Cave represented the opponent.

4. The grounds argued at the hearing were those under sections 44, 60 62A and 42(b) of the Act. As the ground under section 60 of the Act is straightforward and should very obviously succeed, I will direct my discussion of the evidence and submissions of the parties to that ground.

The Evidence

1. The evidence in this matter comprises:

   In support

   ·     Statutory declaration of Kimberly Jade Evans dated 11 June 2009 (‘Evans 1’);

   ·     Supplementary statutory declaration of Kimberly Jade Evans dated 18 August 2009 (‘Evans 2’); and

   ·     Statutory declaration of Todd Santos dated 18 August 2009 (‘Santos 1’).

   In answer

   ·     Statutory declaration of Julie Elizabeth Plummer dated 24 February 2010 (‘Plummer’);

   In reply

   ·     Statutory declaration of Todd Santos dated 23 November 2010 (‘Santos 2’).

2. The opponent has used the trade mark QUICKBOOKS[1] in Australia since 1994 in relation to an accounting software program and technical and support services.[2]  The opponent’s QUICKBOOKS trade mark is registered in Australia as below:

Registration No:              603749

Priority Date:  2 June 1993

Goods:  Class 9: Computer software; and all other goods in this class

Trade Mark:  QUICKBOOKS

Application No: 603750

Priority Date:  2 June 1993

Goods:  Class 16: Instruction manuals; and all other goods in this class

Trade Mark:  QUICKBOOKS

[1] In evidence the opponent’s trade mark is rendered as both QuickBooks and QUICKBOOKS but nothing, in my consideration, turns on this distinction.

[2] Santos 1, para 7

1. The opponent has a significant equity interest in Reckon Limited, an Australia Public Company (‘Reckon’). Since 1994, Reckon has operated, and continues to operate, its business in Australia subject to an exclusive license from the opponent for use of the trade mark QUICKBOOKS and sells or distributes product in Australia for the opponent.[3] 

   [3] Evans 1, para 20.

2. There is a number of different accounting and financial software packages sold under the trade mark QUICKBOOKS in Australia under the opponent’s aegis including those tailored for accountants, retailers, small and large businesses and so on.

3. The opponent through Reckon sells many thousands of its accounting software packages under the trade mark QUICKBOOKS within Australia each year and devotes well in excess of a million dollars a year advertising and promoting its goods within Australia.[4]

   [4] Exact details are subject to a confidentiality claim and are not in dispute between the parties.

4. The opponent has won wide recognition for its accounting software products sold under the trade mark QUICKBOOKS in Australia each year from computer magazines.[5]

   [5] Evans 1, paras 24 – 29.

5. Reckon Accredited Partners are consultants, trainers, bookkeepers and accountants who undergo training and accreditation to support clients using Reckon products which include, inter-alia, goods sold under the trade mark QUICKBOOKS.[6] 

   [6] These include QuickBooks Accountants Edition, Reckon Payroll Premier, Reckon Retail Point of Sale and Quicken Home & Business,

6. Mrs Plummer explains that she is ‘engaged’[7] by CADCAM to run its “Mrs Quick Books” division, which is part of CADCAM’s business.[8]  CADCAM is a company established in 1988 by Mrs Plummer’s husband, which business is principally concerned with the sale of computer assisted drawing (“CAD”) software.  Mrs Plummer says that she established the Mrs Quick Books name and business on behalf of CADCAM in 1996[9] and in the course of running the Mrs Quick Books division Mrs Plummer provides business management and training services to clients.[10]

   [7] By this I take it that Mrs Plummer is an employee or contractor engaged by CADCAM but the precise nature of her relationship with CADCAM is not explained.

   [8] Plummer, para 2.

   [9] Plummer, para 6.

   [10] Plummer, para 7.

7. Mrs Plummer declares:

   In paragraphs 16 and following of the Santos declaration Mr Santos states that his company, Intuit Inc, has various concerns over the fact that CADCAM has applied for registration of the Mrs Quick Books logo and what the use and registration of the trade mark will mean to Australian consumers. I understand that the concerns relate to the fact that the Mrs Quick Books logo includes the words MRS QUICK BOOKS rather than the logo elements. I am very surprised by the statements made by Mr Santos in those paragraphs, particularly given my past relationship with Reckon Limited (“Reckon”) and the way Reckon operates in relation to its Quick Books products and its accredited partner system.

   The Santos declaration sets out details of the use in Australia of the trade mark QUICKBOOKS by Reckon. I am aware of the Reckon software packages sold under the name QUICKBOOKS. I do not dispute that QUICKBOOKS accounting packages are well known in Australia and have been for many years. Details of the QUICKBOOKS product are set out in the declaration of Kimberley Jade Evans which is Exhibit TS-1 to the Santos declaration. QUICKBOOKS accounting packages are a mainstream product available from a wide range of retail outlets. They are aimed primarily at small business users. I consider the QUICKBOOKS accounting packages are a good product. However, many purchasers require assistance to install and operate the products. Rather than retain a large number of service personnel to assist purchasers in the installation and operation of their products, Reckon has established a system of “Accredited Partners” who provide that service. These Accredited Partners are independent third parties who are presented by Reckon to the public as persons who are able to assist purchasers of Reckon products. Accredited Partners provide their services to their clients for a fee.

   In order to become an Accredited Partner a person must make an application to Reckon. That application includes payment of a fee and the undertaking of training in the operation of Reckon products. In order to maintain the accreditation, the Accredited Partner must pay an annual renewal fee to Reckon and undergo further training in new products.

   There are three categories of Reckon Accredited Partners, being “consultants”, “bookkeepers” and “accountants”. As stated on the Quicken website, in relation to “consultants”, this is the category for “software training and implementation specialists who analyse clients’ business needs and requirements and provide ongoing Reckon software support and training”.

   I became a Quicken Accredited Partner in 1998 and have been an Accredited Partner since. Quicken accreditation is only available to individuals. At the time I gained “partner” accreditation I had been operating the Mrs Quick Books business (on behalf of CADCAM) for about two years. I had registered Mrs Quick Books as a business name Business name number VIC 1290489Z in 1996. Now produced and shown to me marked Exhibit JP-1 is a copy of the Certificate of Registration of Business Name for MRS QUICKBOOKS. I chose the name MRS QUICKBOOKS because I wanted a playful name which indicated to my customers and potential customers what I do, which is that I am an expert in QUICKBOOKS software. The business I operated at that time and which I continue to operate is to provide my clients with training and assistance in the installation and operation of Quick Books accounting packages.

   I have developed a reasonably substantial client base since I began operation. I now have a client list of approximately 300 individuals and businesses for whom I do work as required. I generate business from word of mouth referrals and as a result of my accredited partner listing on the Quicken website.

8. The exact nature of the difference or similarity of being a Quicken Accredited Partner or a Reckon Accredited Partner referred to above by Mrs Plummer is not explained and it could be that the terms are being used by her interchangeably.  The Reckon and Quicken websites seem to be to very similar but it would appear that QUICKEN is a trade mark[11] owned by the opponent and used by Reckon under license in the same manner that the opponent’s QUICKBOOKS trade mark is used in Australia.

   [11] Registered by the opponent in Australia under 603747(9), 603748(16) and 624173(9).

9. The confusion as to whether Mrs Plummer is a Quicken Accredited Partner or a Reckon Accredited Partner is not relevant to the outcome of these reasons.

10. Mrs Plummer’s declaration and exhibits thereto show that various other accredited partners operate under business names which include the words QUICKBOOKS or Quick Books.

11. I note that Mrs Plummer states that the QUICKBOOKS accounting packages are well known in Australia and have been for many years.  I also note that Mrs Plummer became a an Accredited Partner in 1998 and there is no suggestion in the evidence that CADCAM is an Accredited Partner and in fact it cannot be so since only individuals may become accredited partners.

Onus

1. It is the practice of the delegates of the Registrar to follow Pfizer Products Inc v Karam [2006] FCA 1663, as regards onus. Gyles J said of the onus in trade mark oppositions:

   I am faced with the clear words of the statute, on one hand, and the opinions of various judges, on the other. There is no binding Full Court authority. I cannot find any instance where a single judge has actually applied the higher standard. In my opinion, in this case, comity does not demand that I depart from my view as to the meaning of the statute. ‘The fundamental responsibility of a court when it interprets a statute is to give effect to the legislative intention as it is expressed in the statute’ per Mason J in Babaniaris v Lutony Fashions Pty Ltd [1987] HCA 19; (1987) 163 CLR 1; cited with approval by Mason CJ, Wilson, Dawson, Toohey and Gaudron JJ in John v Federal Commissioner of Taxation [1989] HCA 5; (1989) 166 CLR 417 at 439. I will, therefore, approach the matter on the basis that the opponent has to establish a ground of opposition, although not clearly establish such a ground, whether in a summary fashion or otherwise.

2. See also Chocolaterie Guylian N.V. v Registrar of Trade Marks [2009] FCA 891 (18 August 2009) at [22] to [26].

3. In submissions Mr Bell, for CADCAM, referred to the recent decision of Lander J in Hills Industries Limited v Bitek Pty Ltd [2011] FCA 94 as an authority for the view that an opposition should be clearly established. Lander J’s words at paragraphs 54-55 were obiter and his Honour was in any event discussing section 56 of the Act rather than section 52:

   In Kowa Co Ltd v NV Organon [2005] FCA 1282; 66 IPR 131 I said that I should follow the decision in Lomas because it was a decision of the Full Court and I should follow Bennett J’s decision in Torpedoes Sportswear Pty Ltd v Thorpedo Enterprises Pty Ltd [2003] FCA 901; 132 FCR 326 as a matter of comity and because other judges of the Court had followed that decision.

   That is still my opinion. It may be, as Gyles J has pointed out, that the decision in Lomas was obiter and does not strictly need to be followed but it is a decision of the Full Court in circumstances where there are competing lines of authority at first instance which have left judges of this Court divided. The conflict cannot be resolved at first instance and must be resolved in the Full Court. As I indicated in Kowa Co Ltd v NV Organon [2005] FCA 1282; 66 IPR 131, I favour the reasoning of Gyles J in Clinique Laboratories Inc v Luxury Skincare Brands Pty Ltd [2003] FCA 1517; 61 IPR 130 but thought because of Lomas v Winton Shire Council [2002] FCAFC 413; [2003] AIPC 91-839 and comity I should follow the other line of authority. That is still my view, notwithstanding the criticism of that approach in Pfizer Products Inc v Karam [2006] FCA 1663; 237 ALR 787. [Stress added]

Section 60

1. Section 60 of the Act provides:

   60Trade 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.

   Note:For priority date see section 12.

2. I observe initially that the use of business names which incorporate the expressions QUICKBOOKS or Quick Books by persons other than the parties to this matter should not of itself guide consideration of whether use of a trade mark which incorporates either expression is likely to deceive or confuse because of any reputation of the trade mark of the opponent.  The question of whether the other uses (if they be uses of trade marks) are infringing uses or are permitted use of business names as may be allowed for under the opponent’s or Reckon’s accredited partners program are questions for the opponent or Reckon rather than for me.  What I am to consider is CADCAM’s use of the opposed trade mark, rather than a business name: see also, Lone Star Steakhouse & Saloon v Zurcas [2000] FCA 29.

3. To satisfy section 60, the opponent must demonstrate that, at the time of filing the opposed application (18 October 2007), there existed a reputation in another trade mark, such that use of the opposed trade mark for the services covered by the application would likely cause a significant number of the public to be deceived or confused. The trade mark relied upon need not be subject of an application or registration in order to be relevant in terms of this section. Section 60 does not require the trade mark relied upon to be ‘deceptively similar’[12] to the opposed trade mark or that it has been used on similar services or closely related goods. Instead, the focus of the provision is squarely upon the likelihood of deception or confusion of the public generated by an applicant’s proposed use of the trade mark on particular goods or services in the face of the reputation of the trade mark(s) relied upon by an opponent.  The reputation of a trade mark may develop in a variety of ways, and be influenced by the particular trading environment in which it has evolved.[13]

   [12] As defined in section 10 of the Act.

   [13] McCormick & Co v Mary McCormick (2001) 51 IPR 102, at 129.

4. In McCormick & Company Inc v McCormick, above, Kenny J said, at 81:

   What is intended by the word “reputation” in s 60? The word is defined in The Macquarie Dictionary as follows:

   reputation ... 1. the estimation in which a person or thing is held, esp. by the community or the public generally; repute ... 2. favourable repute; good name ... 3. A favourable and publicly recognised name or standing for merit, achievement, etc. ... 4. The estimation or name of being, having done, etc, something specified.

   Cf. The Oxford English Dictionary. In s 60, the word is, I think, apt to refer to “the recognition of the McCormick & Co marks by the public generally”.

   Does the evidence establish that in Australia before 9 March 1992 the McCormick & Co marks were recognised by the public generally and, because of that, the use by Mary McCormick of her marks would be likely to cause the public confusion, as for example, by the public’s mistakenly attributing a business connection between the two or attributing her product to the company?

5. There can be little doubt that the opponent’s trade mark QUICKBOOKS was very well known in Australia and had a reputation by 18 October 2007, the priority date of the opposed application, as acknowledged by Mrs Plummer in her declaration made as the applicant’s evidence in answer.

6. In considering whether the use of the opposed trade mark is likely to deceive or cause confusion, the process is governed by the principles specified in Registrar of Trade Marks v Woolworths [1999] FCA 1020 at paragraph 50 by French J who said:

   In Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 at 594-5, which concerned the 1905 Act, Kitto J set out a number of propositions which have frequently been quoted and applied to the 1955 Act. The essential elements of those propositions continue to apply to the issue of deceptive similarity under the 1995 Act. Applied also to service marks and absent the imposition of an onus upon the applicant they may be restated as follows:

   (i) To show that a trade mark is deceptively similar to another it is necessary to show a real tangible danger of deception or confusion occurring. A mere possibility is not sufficient.

   (ii) 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.

   (iii) 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.

   (iv) The rights of the parties are to be determined as at the date of the application.

   (v) The question of deceptive similarity must be considered in respect of all goods or services coming within the specification in the application and in respect of which registration is desired, not only in respect of those goods or services on which it is proposed to immediately use the mark. The question is not limited to whether a particular use will give rise to deception or confusion. It must be based upon what the applicant can do if registration is obtained.

   In respect of the last proposition, Mason J observed in Berlei Hestia Industries Ltd v The Bali Company Inc [1973] HCA 43; (1973) 129 CLR 353 at 362:

   “...the question whether there is a likelihood of confusion is to be answered, not by reference to the manner in which the respondent has used its mark in the past, but by reference to the use to which it can properly put the mark. The issue is whether that use would give rise to a real danger of confusion.”

1. Mr Bell submitted at the hearing that the opponent’s accounting packages were well known at the priority date but this reputation did not extend to services of any nature including those provided by CADCAM.  However, this distinction is not germane to the question of whether CADCAM’s use of the trade mark on the particular services would be likely to deceive or cause confusion in light of the reputation of the trade mark in relation to goods.  The question is rather whether CADCAM’s use of the opposed trade mark on the services, “Accounting; business accounts management; business consultancy; computerised business records keeping” would be likely to deceive or cause confusion because of the reputation of the opponent’s QUICKBOOKS trade mark for computer programs for “accounting; business accounts management; business consultancy; and, computerised business records keeping”.

2. Further, the implied argument that there is no connection between the goods and services of the parties is hollow in light of the fact that Mrs Plummer is an accredited partner to render services in relation to goods sold under the opponent’s trade mark QUICKBOOKS.

3. Mr Bell also argued that no deception or confusion could arise as the use of the opposed trade mark “by the applicant” is as an accredited partner and the use has always been on that basis.  However, this is plainly not so – the applicant (CADCAM Computer Design Australia Pty Ltd) was not, at the priority date, according to the evidence, an accredited partner.

4. Whatever the merits of a claim that the use of the opposed trade mark by Mrs Plummer would not confuse or deceive might be, Mrs Plummer is not the applicant (CADCAM) nor is it her use of the opposed trade mark that I am to assess here.  It is CADCAM’s use of the opposed trade mark which I am to consider.

5. CADCAM is not an accredited partner.  CADCAM has no connection with the opponent or its licensee Reckon other than the fact that CADCAM apparently engages Mrs Plummer as a contractor or employee.  The terms and conditions of Mrs Plummer’s contract with the opponent or Reckon as regards intellectual property such as use or control of trade marks are thus not relevant as CADCAM could not be bound by the opponent or Reckon to perform those terms and conditions.  CADCAM (on the face of the evidence before me) has no privity to any contract that Mrs Plummer might have entered into with the opponent or Reckon.[14]

   [14] As a general common law rule, only parties to a contract will have rights or obligations under that contract. Consequently, a contract between A and B cannot impose obligations on C; conversely, a contract between A and B cannot be enforced by C, even if the contract is intended to benefit C:  Tweddle v Atkinson (1861) 1 B & S 393; 121 ER 762; [1861-1873] All ER Rep 369: John Tweddle (the Plaintiff's father) agreed with William Guy (the Plaintiff's father in law) for the latter to pay money to the Plaintiff upon marriage. Guy died before making payment and the Plaintiff (William Tweddle) sued the estate (Atkinson was the executor) for the promised sum. No consideration moved from the plaintiff to Guy and therefore the plaintiff had no right to sue on the contract. Natural love and affection is not good consideration (Crompton J).

6. The opponent’s trade mark is contained within the opposed trade mark.  It forms a distinct part of it, falling within the expression ‘Mrs Quick Books’ which is only way in which a verbal identification of the opposed trade mark might be formulated.  The differences between the expressions ‘Quick Books’ or ‘QuickBooks’ or ‘QUICKBOOKS’ are de minimis as the words are immediately identifiable and recognised.  The word ‘Mrs’ focuses attention on the expression ‘Quick Books’.  Because of the reputation of the opponent’s QUICKBOOKS trade mark, it is the opponent’s well known trade mark and accounting packages which immediately comes to mind when encountering the opposed trade mark.  CADCAM’s use of the opposed trade mark on services integral to accounting software confusingly and deceptively suggests that services originate from it under the aegis of the opponent.

7. In my consideration, the use of the opposed trade mark by CADCAM could not do other than confuse or deceive.  It suggests a connection between the CADCAM and the opponent (or a licensed,[15] sanctioned and controlled use of its well known trade mark) where there is none.

   [15] See for example GM Holden Ltd v Paine [2011] FCA 569 at para 24

8. I add that had the application been filed in the name of Mrs Plummer my findings would have ultimately been similar.

9. The opponent has established its opposition under section 60 of the Act.

10. There is no need to discuss the other grounds which were argued at the hearing.

Decision

1. Subsection 55(1) of the Act provides:

   Unless the proceedings are discontinued or dismissed, the Registrar must, at the end, decide:

   (a) to refuse to register the trade mark; or
   (b) to register the trade mark (with or without conditions or limitations) in respect of the goods and/or services then specified in the application;

   having regard to the extent (if any) to which any ground on which the application was opposed has been established.

   Note:  For limitations see section 6.

2. I refuse to register application 1203904.

Costs

1. The opponent, having been successful, is entitled to its costs which I award at the official scale against the applicant.

Iain Thompson

Hearing Officer

Trade Marks Hearings

20 June 2011