Mary McCormick v McCormick & Company Incorporated

[1998] ATMO 24

TRADE MARKS ACT 1995

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

Re:      Opposition by McCORMICK & COMPANY, INCORPORATED to the    registration of application number 574023 for series of trade marks in the       name of MARY McCORMICK 

This matter concerns trade mark application number 574023 which was filed on 9 March 1992 in the name of Mary McCormick, (the applicant), seeking registration of series of four trade marks which were subsequently amended to series of two word marks:

MCCORMICK’S
MCCORMICK’S INSTANT BATTER SIMPLY ADD WATER

in respect of a statement of goods, in class 30, reading:

“All goods in this class; batter including instant batter; dried fruits; nuts including peanuts”.

These goods were restricted during the course of examination of the application to “Instant batter”.  Acceptance of the mark, under the provisions of sub-section 41(5) of the Act, was advertised in the Australian Official Journal of Trade Marks of 22 February 1996. 

Notice of opposition to registration of the applicant’s mark was filed on 22 May 1996 by McCormick & Company, Incorporated, (the opponent).  Of the listed grounds of opposition, at the hearing the opponent elected to concentrate on submissions and evidence based on the grounds:

• that the applicant’s marks are substantially identical with or deceptively similar to the opponent’s trade marks which are registered in respect of similar goods as those of the applicant - sub-section 44(1)

• that the applicant’s marks are substantially identical with, or deceptively similar to the opponent’s trade marks which, before the priority date for registration of the opposed trade marks had acquired a reputation in Australia and, because of that reputation, the use of the applicant’s marks in respect of the goods specified in the application would be likely to deceive or cause confusion - section 60

• that the applicant’s trade marks are not capable of distinguishing the goods for which registration is sought from the goods or services of other persons - sub-section 41(2).

The normal stages of serving and filing of the evidence were completed on 20 February 1997.  On 8 January 1998, under the provisions of regulation 5.15, the applicant sought permission to serve a copy of further evidence on the opponent, together with the evidence, which was allowed.  Subsequently, the opponent was successful in being granted leave to adduce evidence in rebuttal to the applicant’s further evidence.

The opposition was heard by me, as the Registrar’s delegate, in Canberra on 4 March 1998.  Mr Adrian Ryan of Counsel, instructed by Mr Russell Waters of Phillips Ormonde & Fitzpatrick, patent and trade mark attorneys of Melbourne, appeared on behalf of the opponent in the proceedings.  Mr Ian Tannahill of Pizzeys, patent and trade mark attorneys of Brisbane, represented the applicant by telephone.

Evidence
Evidence in support:

*     statutory declaration by Timothy Large, dated 14 August 1996, with         exhibits 1 to 5, exhibits 2 and 3 being confidential;

*     statutory declaration by Fred H. Lissauer, dated 13 August 1996, with
      exhibits 1 to 3, exhibit 3 being confidential;

*     statutory declaration by R.T. Creighton, dated 16 August 1996;

*     statutory declaration by Russell John Waters, dated 15 August 1996,         (Waters’ first declaration). 

Evidence in answer:

*     statutory declaration by Mary McCormick, dated 19 November 1996, with           exhibits MM-1 to MM-9.

Evidence in reply:

*     statutory declaration by Russell John Waters, dated 20 February 1997,
      with exhibits RJW-A to RJW-F, (Waters’ second declaration).

Applicant’s further evidence:

*     statutory declaration by Ian Robert Tannahill, dated 8 January 1998, with exhibits A and B

Opponent’s further evidence:

*     statutory declaration by Russell John Waters, dated 17 February 1998. with
      exhibit RJW-1, (Waters’ third declaration)

Background
The opponent has a number of allegedly conflicting trade marks registered in Australia for many years.  These trade marks have been largely used by the opponent’s authorized user, a wholly owned subsidiary of the opponent.  The details of the sales and advertising figures in relation to the products under the various marks are set out in Mr Large’s confidential exhibits.  In addition to sales to the consumers through the grocery trade, the user has provided bulk products to consumers in the fast food trade.  These products have included batter mixes and breading mixes, which have been sold to the grocery trade for retail sales under the mark GOLDEN DIPT, identifying the opponent’s product as distributed in Australia by its authorized user.  The user of the opponent’s marks had received queries in relation to instant batter before it had commenced using the product as part of its product range.  These enquiries, according to opponent’s declarants, were intended to be directed to the  applicant in relation to the product sold under the marks of the present application. 

As declared by Ms McCormick, the applicant and her husband commenced business in July 1971 by selling instant batter under the mark McCORMICK’S, chosen for the couple’s surname and the association with the particular batter which had been developed by them.  The product was first supplied to the local supermarket in packets and later to other supermarkets in Queensland.  By 1979, a small factory was established to meet the growing demand for the instant batter.  In 1994, the applicant had registered a company Mary McCormick Pty Ltd, which was permitted to use the mark McCORMICK’s in respect of instant batter.  The declarant provides retail value of the product, together with the number of cartons, between the years 1990 and 1994, as well as cartons of two different weights for the financial years from 1994 to 1996.  The approximate amount spent on advertising is also given.  Mrs McCormick states that, whilst the revenue derived from the sale of the instant batter is quite small, she lives off that income and depends solely upon it.  If she were forced to change the trade mark, then her livelihood would be threatened and the goodwill derived from using a trade mark, which persons associated with her personally, would be lost.

Annexed to Mr Waters’ second declaration, which forms evidence in reply, are exhibits showing the opponent’s products located in close proximity to packets of instant batter or batter mixes.  Mr Waters says that, shortly before receiving Mrs McCormick’s declaration, he had noticed that instant batter products by Mary McCormick Pty Ltd were sold under a different trade mark, despite her claims that a change to her trade mark would threaten her livelihood.  The opponent had contacted the applicant with an offer to settle the present opposition on the basis that the opposition would be withdrawn and consent provided to the applicant’s continued use of its altered mark, if the present applicant were to be withdrawn.  The opponent had not received any response.

The applicant’s further evidence contains exhibits which had come to light as a result of an article on the applicant, published on 16 December 1997.  This evidence is purported to show that the opponent was aware of use of the applicant’s mark not in the mid 80s, as indicated in Mr Creighton’s declaration, but at the very least in the late 70s, and that the opponent had acknowledged the applicant’s rights to the mark.

The opponent’s evidence in reply seeks to rebut the applicant’s further evidence and produces, as an exhibit, a further declaration in support of confusion between the applicant’s product and the opponent since 1994. 

Submissions and discussion
Whether the marks are substantially identical or deceptively similar
Subsection 44.(1) provides that:

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. 

The term “deceptively similar” is defined under section 10 of the Act:

1. For the purposes of this Act, 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.

As was done for the purpose of section 33 of the Trade Marks Act 1955, in order to determine whether the marks are substantially identical or deceptively similar, I must compare the applicant’s and the opponent’s marks under consideration, assuming a fair notional use in respect of all the goods covered by them.  

Although Mr Large had exhibited various opponent’s trade marks containing the word McCORMICK, at the hearing Mr Ryan relied on the following registrations, all of which bear a priority date:

Number  Class   Goods   Trade Mark

1. 30     Spices; condiments; seasonings, extracts and
     essences for flavouring foods

1. 29     Spices; condiments; seasonings, extracts and

   essences for flavouring foods
     

2. 29     Mayonnaise and other dressings for salads and
     other foods; dehydrated potatoes

1. 29     Mayonnaise and other dressings for salads and

   other foods; dehydrated potatoes
     

2. 30     Herbs and spices, sauces, seasonings and
     gravies

1. 29     Salad dressings including mayonnaise and
     coleslaw dressings

The criteria for determining whether trade marks are substantially identical or deceptively similar have been set out in the frequently quoted passages in Shell Co (Aust) Ltd v Esso Standard Oil (Aust) Ltd (1961) 109 CLR 407 at 414-415 and in Australian Woollen Mills Ltd v F S Walton & Co Ltd (1937) 58 CLR 641 at 658. In applying the test in respect to the former, where one is to compare the marks side by side, the additional features to the surname McCORMICK in the opponent’s marks, i.e. either the word BANQUET, the device of a candle or the letters “Mc”, as well as the “get-up” of the marks, are sufficient to render these marks as not substantially identical with the applicant’s marks, which are represented in plain letters and other distinguishable feature, i.e. the possessive form of McCORMICK and the additional words INSTANT BATTER SIMPLY ADD WATER to the second mark of the series.

In all the opponent’s registered marks shown above is present a dominant element McCORMICK which, with the apostrophe and the letter “S”, also occupies a dominant position in the applicant’s marks.  Considering that this almost similar feature in the marks is likely to be impressed on the potential purchasers’ minds, recalled and used for the obvious verbal identification of the products in question, and being mindful of the tests outlined in the cases cited by me, I agree with Mr Ryan’s submissions to the extent that the marks are deceptively similar. 

It has been said that food products, which would embrace the goods covered by the opponent’s registrations and those of the present application, need not necessarily be goods of the same description - Societe Francaise des Viandes et Salaisons Du Pacifique v Societe des Produits Nestle SA 15 IPR 89, and that each case must be decided on its own facts. As Mr Ryan noted, the tests concerning whether goods are of the same description appear in John Crowther & Sons (Milnsbridge) Ltd’s Appn (1948) 65 RPC 369 at 372. In Jellinek’s Appn (1946) 63 RPC 59, Romer J enumerated the factors for consideration as: the nature of the goods, the uses thereof and the trade outlets through which the goods are bought and sold. Basically, the opponent’s products are ingredients for foods, while batter is a mixture of flour and liquid, usually used for making pancakes, waffles or crumpets, or in coatings for batter-fried foods. The evidence shows that the applicant’s batter is primarily used as a coating mixture for frying fish, prawns, chicken pieces, fritters, etc. Both the applicant’s and the opponent’s products are therefore added to various items of food and serve the purpose of enhancing their flavour. The opponent has produced four exhibits to Mr Waters’ second declaration showing batter mix packets, including the applicant’s product bearing the mark MARY McCORMICK’s with a portrait device, displayed on supermarket shelves next to each other, or in close proximity to the opponent’s goods. In light of the tests of Romer J, I consider the opponent’s and the applicant’s goods to be of the same description.

Having regard to my foregoing analysis, I find the applicant’s marks to offend against the provisions of subsection 44(1) of the Act. 

Whether the applicant has established a case of honest concurrent use or other circumstances

Even if a trade mark is rejected for registration in terms of subsection 44(1) of the Act, under the provisions of subsection 44.(3), if the Registrar 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.

The matters to be taken into account when assessing registrability of a mark under subsection 34(1) of the Trade Marks Act 1955, which is the equivalent of subsection 44(3) of the current Act, have been set out in Re Alex Pirie & Sons Ltd’s Application (1932) 49 RPC 195; Re Alex Pirie & Sons Ltd’s Application (1933) 50 RPC 147; John Fitton & Co Ltd’s Application (1949) 66 RPC 110 and followed in recent Trade Marks Office decisions, including Stingray Surf Company Pty Ltd v Lister 37 IPR 306, which was cited by Mr Ryan. Those factors are as follows:

1. the honesty or otherwise of the concurrent use

2. the extent of use in duration, area and volume

3. the degree of confusion likely to ensue between the trade marks in question

4. whether instances of confusion have in fact occurred

5. the relative inconvenience that would be caused to the respective parties

   if the applicant’s trade mark should be registered or not registered

6. any conditions or limitations.

I propose to consider those factors in turn.

1. Mr Ryan submitted that the opponent was not suggesting that the applicant had deliberately sought to take advantage of the opponent’s goodwill.  It was relevant, however, that the applicant was aware of the opponent’s marks at the commencement of use of the mark in suit.  While not denying the applicant’s knowledge of the opponent’s marks, Mr Tannahill said that, by using the surname McCORMICK”S for instant batter, the applicant had not envisaged any deception or confusion, pointing out that the applicant’s trading style and packages bore no resemblance to those of the opponent’s marks.  He said that the adoption of a trade mark which is known to closely resemble a mark used by another was not necessarily dishonest, as, for example, in Pirie’s Application, supra, where the applicant had been aware of the mark HAMMERMILL at the time of selecting ABERMILL.  He further submitted that, if the applicant were to use the style of packaging which was similar to that of the opponent, the opponent could always bring an action against the applicant for passing off or breach of the Trade Practices Act, or it could apply for registration both for the colour of packaging and the “get-up” of its packaging under the current Trade Marks Act. 

Mrs McCormick has declared that, at the time of adopting the surname of her husband and herself for use as a trade mark in respect of batter, both of them had been aware of another owner’s trade mark McCORMICK in respect of mixed herbs, paprika, pepper and basil.  They did not think any deception or confusion of the marks was likely, particularly because the name had been associated with their batter since they had been selling fish from a roadside caravan.  They had commenced business using the mark McCORMICK’S on instant batter in July 1971.  At the outset, use of their mark was localized and limited to Innisfail, in the state of Queensland.

If at that time Mr and Mrs McCormick knew of use of the mark McCORMICK only for a very restricted range of goods, such as those identified in the declaration, it is reasonable to assume that they did not expect any of the purchasers of batter to wonder about the origins of the goods.  The choice of a person’s surname for use in relation to products he or she manufactures and is endeavouring to establish a reputation is not at all unusual.  In the present circumstances, there does not seem to be anything sinister or untoward in selecting the applicant’s surname, nor any suggestion that the applicant was attempting to derive any advantage from this choice.  Considering this factor in light of the words of Lord Tomlin in Pirie’s Application, supra, at 159 that “[k]nowledge of the registration of the opponent’s mark may be an important factor where the honesty of the user of the mark sought to be registered is impugned, but when once the honesty of the user has been established the fact of knowledge loses much of its significance, though it may be a matter not to be wholly overlooked in balancing the considerations for and against registration”, I see no reason to question the applicant’s honesty in adoption and use of the subject marks. 

1. Concerning this issue, Mr Ryan said that, before the date of the present application, which is the relevant date for this purpose, use of the applicant’s marks disclosed only a modest volume of sales and advertising expenditure.  Furthermore, the evidence indicated most of the sales having been confined to the state of Queensland, noting that some customers had experienced difficulties in purchasing the product.  In reply, Mr Tannahill conceded that initially use of the marks had been limited to Innisfail and Cairns in Queensland, but that the demand for the product had grown, and by 1978 orders for the product had been arriving from all over Australia.  The batter market was not very extensive, he said, nevertheless, the applicant’s sales of the batter mix had been regular, generally increasing and of real commercial value.  Referring to Emdon Investments v Shell International Petroleum Co Ltd 12 IPR 525, Mr Tannahill commented that, in that case, the hearing officer had found the applicant’s evidence to have a real commercial value in relation to the goods of interest over a reasonable period, despite the fact that the sales figures for the three years had amounted to less than those of the applicant for the same length of time.

Even though first use of the applicant’s mark McCORMICK’S occurred in 1971, the applicant has provided approximate retail sales figures for batter only from 1990.  From those figures, before the present application the value of sales for the financial years 1990 and 1991 has been estimated to be $298,000.00 (29,000 cartons) and $180,000.00 (17,000) for the subsequent financial year ending approximately four months after lodgment of the application, therefore a proportion of this amount may be considered as representing sales in the relevant period.  The amount spent on advertising for the corresponding periods is given as $6,500.00 and $11,000.00, respectively. 

Mrs McCormick has stated that orders for her product had been received from all parts of Australia as well as the United States of America.  She supports this by an article in The Cairns Post of 24 June 1992, which outlines the history and development of Mrs McCormick’s business.  In another undated newspaper report, Mrs McCormick is quoted as saying:

During the early days our market was mainly local, but it has grown to where I now sell it [the batter] all around eastern Australia.

The availability of the product throughout Australia, even in the eastern states, before March 1992 is not adequately evidenced.  Four copies of exhibited letters, two each from enquiring prospective customers from New South Wales and Victoria, suggest awareness of the product and that it had been available in some stores in the former, but that persons encountered difficulties finding the product in either state.  Mrs McCormick makes reference to demonstrations of the batter, one having taken place on the Ray Martin Show televised nation-wide on 7 October 1991, without providing details.  There are no separate sales figures from each of the states where the goods have been marketed, nor are there any supporting declarations from person who claim to have knowledge of the mark.  

Compared to the value of the opponent’s goods during the corresponding period, the applicant’s sales figures under the mark, even allowing for the single item, are not excessive if they are purported to represent sales of the batter in the whole of Australia, but could be said to have real commercial value if those sales are attributable to the states of Queensland and New South Wales, where, according to the evidence, most of the sales appear to have taken place.

1. Mr Ryan pointed to the confusion of the marks that had already occurred as a result of the applicant’s past use of her marks.  This confusion was expected to increase, since the marks the subject of this application did not contain the fancy type and decoration to conform with past use, he said. 

Mr Tannahill countered this allegation, arguing that, broadly speaking, if a trade mark was commonplace, purchasers would not expect exclusive proprietorship - Jean Patou Parfumeur v Crisena Corp Pty Ltd 20 IPR 660. Persons who shop in supermarkets and similar outlets, he said, were familiar with the use of surnames by traders in a trade mark sense and, because of the very nature of the supermarkets, purchasers would expect the goods sold therein to have been sourced from a significantly large number of manufacturers. He pointed out that persons ordering the applicant’s batter in the large 10kg cartons for prepared meals typically referred to the product as McCORMICK’S. In his opinion, given the customers’ familiarity with the products, the regularity of their purchases, and the care shown in purchasing food items, the likelihood of deception or confusion of the marks would be slight. He then referred to “Buler” Trade Mark [1975] RPC 275 at 289, where Graham J said that the degree of likely confusion was relatively unimportant, provided the applicant’s honesty was established and the mark was found to be registrable in all other circumstances. He said that a similar point had also been made in the judgment of Dawson & Toohey JJ in New South Wales Dairy Corporation v Murray Goulburn Co-operative Company Pty 18 IPR 385 at 416.

Having regard to the close resemblance of the opponent’s and applicant’s marks and the fact that, as established by the opponent’s evidence, the products in question are found in the supermarkets in the same locations next to each other, the likelihood of their confusion is real.  Notwithstanding this factor, being able to inspect, compare and select a product in a supermarket or a similar outlet, the prospective purchasers of the particular range of the opponent’s and applicant’s food products would, in my opinion, be discerning and cautious in their purchase, unlikely to select, for example, instant batter mix for seasoning mix.  In the absence of the opponent’s use of the mark McCORMICK in respect of batter in bulk quantities, the possibility of confusion would be further reduced.  Nor do I believe that the applicant’s marks used in the form of the present application would be likely to increase the confusion, as argued by Mr Ryan, as the applicant’s evidence also shows use of the mark with the word McCORMICK’S in ordinary upper case letters rather than only in fancy type with embellishments. 

Whilst the degree of confusion is an important factor in relation to subsection 44(3), it has been laid down that honest concurrent use provisions are not limited to only those marks where the degree of confusion likely to occur would be inconsiderable.  In Alex Pirie, supra, (Court of Appeal), Lord Justice Hanworth, speaking of section 21 of the 1905 UK Act, the equivalent of subsection 34(1) of the repealed Act in Australia and now equivalent to paragraph 44(3)(a), stated at 213, that:

.... [it] is a Section which does not carry with it a limitation as to there being a slight possibility of deception, for its words indicate that the Registrar may permit the registration of the same trade mark, or of nearly identical trade marks, for the same goods by more than one proprietor.  It seems to indicate that the powers of the Court [and the Registrar] can be exercised even when there is likely to be confusion between the marks.

1. The opponent’s claim of confusion of the marks is based on two opponent’s statutory declarations by Mr Creighton and Ms Goldsworthy, both of whom refer to queries addressed to the opponent concerning instant batter at the time when the opponent had not commenced producing it as part of its product range.  There appears to be an inconsistency in the latter’s statement in that Mr Large attests to the opponent supplying it only in bulk quantities to the fast food outlets during the specified period but not yet offering it for retail sales.  It is assumed Ms Goldsworthy had in mind the queries received before the opponent’s retail sales of the batter. 

As was noted by Mr Tannahill, however, at the time of applying for registration of the applicant’s mark, the opponent did not produce batter in Australia.  Both Mr Creighton and Ms Goldsworthy state that they knew of the applicant’s marks and had concluded “that the enquiries directed to McCormick Australia were in relation to the product provided by the Applicant herein”.  No further information has been furnished as to the exact nature and frequency of the enquiries.  Such information is vital in order to assess the seriousness of the alleged confusion and whether it was caused by the marks appearing on the product of the present applicant rather than by another trader’s mark.  In its absence, I propose to give the evidence by Mr Creighton and Ms Goldsworthy only minimal weight.  In this regard I rely on Emdon Investments v Shell International, supra, which was cited at the hearing by Mr Tannahill. 

1. According to Mr Ryan’s submissions, the applicant does not need registration to trade under its marks, but if the marks were to be registered, then the opponent would be prevented from using its house mark in relation to batter.  Further, the applicant’s claim that a change of her mark would threaten her livelihood, should not be given any weight, having regard to the changes that have already occurred. 

By way of introduction to this criterion, Mr Tannahill referred me to MacDonald and Muir Ltd v Clarevale Isaia Pty Ltd 47 IPR 271, where the hearing officer had said that “in the event of failing to register the mark, the applicant’s goodwill would dissipate, it would suffer financial losses as well as the inconvenience of potential infringement”. While the applicant’s use did not infringe any of the opponent’s registrations, he said, it was conceivable that refusal to register the subject marks would adversely affect the applicant’s goodwill and the inability to obtain injunctive relief, should other traders choose to use a deceptively similar mark in respect of batter and it may ultimately lead to the demise of the applicant’s business. Should registration of the application be refused, Mr Tannahill said, then it was possible that the opponent will commence use of a mark containing the word McCORMICK in respect of batter, noting the opponent’s pending application number 631412. Given the opponent’s resources and the amount spent annually on advertising and the fact that retailers pay for shelf space on supermarket shelves, it was conceivable that a well orchestrated advertising campaign conducted by the opponent, possibly in conjunction with the purchase of shelf space at eye level and/or “price cutting”, could, in a matter of months, destroy a business which the applicant had built over a period of twenty-seven years.

Mr Tannahill further submitted that the applicant had adopted another mark containing the words MARY McCORMICK with a portrait device and, in April 1996, she had decided to use the mark on any of her new products.  The 150gm packets of batter mix sold in supermarkets, he explained, were branded with this trade mark as a prelude to the introduction of her new product range.  Batter sold in 10kg cartons, however, had continued to be marketed under the McCORMICK’s trade mark.  Based on the figures contained in the applicant’s declaration, in relation to the quantity of batter sold during the financial year of 1995 to 1996, the batter sold in these cartons had represented 74% of the applicant’s batter, therefore the market of the cartons bearing the original trade mark was significant to the applicant.  

In response, Mr Ryan said that Mrs McCormick had made the point that people associated the batter with her personally, and wishing to capitalize on that personal association, she had changed her mark.  She was quite entitled to use her own name in relation to her product.  He could not see that, by not registering the mark MCCORMICK’S simpliciter, Mrs McCormick would suffer the collapse of her business, or loss of any goodwill. 

Having considered the submissions, I have concluded that the balance of convenience must be in favour of the applicant, who, having used the mark McCORMICK’S since 1971 and built up a reasonable reputation, would lose the protection of its registration and may be compelled to cease using her original mark in relation to the large size cartons of batter, thus abandoning the goodwill attached thereto. 

The opponent has not demonstrated any serious disadvantages that would be suffered by it in the event of registration of the subject marks.  It has marketed batter in Australia under the mark GOLDEN DIPT, but has not shown any use in respect of the product of a mark which includes the word McCORMICK.  Moreover, from a newspaper article published in the Advocate, which was produced in the applicant’s further evidence, it appears that the opponent had known of the existence of the applicant’s mark since the late seventies.  If its use had caused distress to the opponent, then it had failed to raise any objections so that the applicant could consider the option of altering her trade mark.

1. Mr Ryan expressed the view that, if the applicant’s marks were to be registered, then registration should be confined to northern Queensland and a condition imposed on the applicant that the marks include the word MARY before the surname McCORMICK’S.

Having regard to my previous comments, I do not see any good reason for the proposed amendment of the applicant’s marks.  I have, however, expressed my reservations as to factual evidence substantiating use of the marks in the whole of Australia, or even in all of its eastern states.  Evidence of use before the date of the present application has been demonstrated in the state of Queensland and, from the copies of letters concerning enquiries about the batter, it can be deduced that the product has also been sold in New South Wales.  

Having assessed the applicant’s evidence in light of the relevant factors in terms of subsection 44(3), I consider that the applicant has successfully discharged her onus for establishing honest concurrent use of the mark as far as this use extends to the states of Queensland and New South Wales.

Section 60 - trade mark similar to trade mark that has acquired a reputation in Australia

Under the provisions of this section:

60.  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.

Mr Ryan said that, given the very significant use in Australia of the opponent’s marks which include the word McCORMICK before the relevant date and the manner in which each party’s goods were sold to the public, it was inevitable that use of the applicant’s mark would be likely to deceive or cause confusion.  He expressed the opinion that subsection 44(3) of the Act did not affect the operation of section 60.  His reasons were based on the argument that, contrary to the current Act, under the Trade Marks Act 1955, section 34 concerning honest concurrent use had been a stand-alone provision which did not modify any other provision and that paragraphs 28(a) and 28(d) had to be read conjunctively.  Therefore, he said, even if there was a reason for applying the provisions of subsection 44(3) of the Act in respect of the ground of opposition under subsection 44(1) based upon the opponent’s prior registered marks, subsection 44(3) has no effect on the present ground of opposition. 

The details of the retail gross sales of the opponent’s products under the registered marks, as well as the amounts expended on their promotion and advertising, are confidential.  The opponent has provided sales value and advertising figures from 1991 to 1995, including separate sales figures from all the states in Australia.  From this evidence it is unquestionable that use of the opponent’s marks, which contain the word McCORMICK, bear a prior date of registration and have been found to be deceptively similar to the applicant’s marks for goods of the same description as those of the applicant, has been extensive and substantial. 

In Australian Law of Trade Marks and Passing Off, second edition, the author, Mr D. R. Shanahan, discussing the effect of subsection 34(1) on section 28 of the 1955 Act, the former being equivalent to subsection 44(3) and the latter closely corresponding to section 60 of the current Act, says, at 201:

... notwithstanding present uncertainties in the construction of s.28, it has generally been assumed that s.34(1) must override s.28, if not by the application of Lord Diplock’s reasoning in “GE”, then simply on the basis that s.28 must be read in its statutory context and should therefore be regarded as subject to the exception provided by s.34(1),

and at 202:

... the common law doctrine of honest concurrent user appears to have contemplated some degree of deception and confusion, as apparently does s. 34(1) itself in referring to “trade marks which are substantially identical or deceptively similar, or, but for the honest concurrent use ... would be deceptively similar”.  Thus it has been the practice in Australia, as in the United Kingdom, to treat the likelihood of deception or confusion as merely one factor affecting the exercise of the Registrar’s discretion.  

This approach is encapsulated by Northrop J (dissenting) in Riv-Oland Marble Co (Vic) Pty Ltd v Settef S.p.A. (1988) 12 IPR 321 at 341:

The common law developed rights by which a trader was able to protect his trade mark against persons infringing those common law rights.  The Trade Marks Acts conferred statutory rights upon registered proprietors of trade marks and empowered registered proprietors to enforce those rights against persons infringing those rights.  In creating and conferring those rights, Parliament prohibited the registration of trade marks which offended the provisions of what is now s 28 of the Act.  In particular, Parliament proscribed the registration of a trade mark which would be likely to deceive or cause confusion.  At the same time Parliament has created exceptions to the general prohibitions contained in s 28.  The discretion conferred upon the Registrar by s 34 of the Act to register a mark in the case of honest concurrent user is an illustration of such an exception.  The power to assign a trade mark with or without the goodwill of the business concerned in the goods or services in respect of which the trade mark is registered is another illustration of such an exception.  These exceptions do not negate the basic concept of the Trade Marks Act that a trade mark should not be registered if its use would be likely to deceive or cause confusion.  

In consideration of these views and the general policy of the Act, I cannot agree with Mr Ryan that the provisions of subsection 44(3) have no effect in respect of the subject application. 

In the present circumstances, while the opponent’s reputation in its registered marks for the respective goods is not questioned, those registered marks have co-existed in the market concurrently with the applicant’s marks for a long period.  As indicated earlier, there is no suggestion that the applicant’s motives in choosing its mark McCORMICK’S were fraudulent.  Moreover, there is insufficient evidence for me to be convinced of any past deception or confusion of the marks.  If deception or confusion had, in fact, come to the notice of the opponent since 1985, as alleged in the opponent’s evidence, then the opponent has had ample time and opportunity to direct it to the applicant’s attention and take steps in preventing it.

In light of the foregoing comments, I do not agree with the opponent’s assertion that, if the opponent were to succeed in relation to the ground based on section 60, then the provisions of subsection 44(3) are not available to the applicant. 

Whether the applicant’s mark is capable of distinguishing
The provisions of subsection 41(5) allow acceptance of a trade mark which is only to some extent adapted to distinguish, but the applicant has satisfied the Registrar that, by virtue of use or intended use of the mark and/or any other circumstances, the mark does or will distinguish the designated goods.  The applicant’s mark is then considered to be capable of distinguishing its goods or services from those of other persons. 

In The Trade Marks Office Draft Manual of Practice and Procedure, Part 22, 18.3, it is stated that:

Trade marks consisting of more common surnames, with an SFAS value greater than 500, may only be accepted on the basis of evidence of use, or any other circumstances . 

During the course of examination of the application, SFAS (Search For Australian Surnames) revealed 1,490 surnames.  The evidence showing progressively increasing sales of the applicant’s instant batter before and subsequent to filing of the application, five years in total, together with reasonable advertising expenditure for the corresponding period, were estimated to be adequate to apply the provisions of subsection 41(5) of the Act to a marks comprising or containing a relatively uncommon surname.  The applicant had sworn as to continuous use of the mark McCORMICK’S throughout Australia.  In support of the application, Mrs McCormick had also produced copies of four letters written to her by satisfied customers.  From these letters, including two which indicated that the applicant’s product had not been available in the Australian Capital Territory and could no longer be purchased in Tamworth, New South Wales (in May 1990), one could hardly doubt the credibility of the applicant’s statement concerning the extent of use.  Consequently, in light of the evidence presented in support of the application, I do not think the examiner and the acceptance officer erred in their assessment of the marks. 

For these reasons, I am not persuaded as to the validity of the opponent’s section 41 ground.   

Conclusions
In summary, I have found that the applicant is entitled to registration of the subject series of marks in terms of subsection 41(5) of the Act.  The applicant has met the requirements of subsection 44(3) concerning honest current use of its marks in the states of Queensland and New South Wales and I have not been shown any good reason for not exercising discretion in this matter.  I dismiss the opposition as far as it relates to the grounds based on sections 41 and 60.  Should there be no appeal against this decision, I direct that the series of trade marks of application number 574023 proceed to registration bearing the following additional endorsement:  Under the provisions of paragraph 41(3)(a) registration of this series of trade marks is limited to the states of Queensland and New South Wales.

Both parties sought costs in these opposition proceedings.  As I have found that the opponent has partially succeeded to the extent that a geographical limitation is to apply to registration of the applicant’s series of marks, I find that each party should pay its own costs.

Vija Zars
Hearing Officer
21 May 1998