Mobile Services International Pty Ltd v Matthew Antony Lynn and Leather FX Pty Ltd

[2019] ATMO 133

TRADE MARKS ACT 1995

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

Re:Opposition by Mobile Services International Pty Ltd to registration of trade mark application 1817125 (12) – LEATHER FX STYLE QUALITY SATISFACTION (Figurative) – in the names of Matthew Antony Lynn and Leather FX Pty Ltd

Delegate:

Nicholas Smith

Representation:

Opponent: IP Partnership

Applicant: Davies Collison Cave Pty Ltd

Decision:

2019 ATMO 133

Trade Marks Act 1995 (Cth) - Section 52 opposition: ss 42(b), 44, 60 and 62A considered – none established – trade mark to proceed to registration

Background

1. This decision concerns an opposition brought by Mobile Services International Pty Ltd (‘Opponent’) pursuant to s 52 of the Trade Marks Act 1995 (Cth) (‘Act’) to the registration of the trade mark which is the subject of the application detailed below in the names of Matthew Antony Lynn and Leather FX Pty Ltd (‘Applicant’): 

Application Number:

1817125

Filing Date:

21 December 2016

Goods:

Class 12: Upholstery for vehicles

(‘Applicant’s Goods’)

Trade Mark:

(‘Trade Mark’)

2.  Following the advertisement on 11 May 2017 in the Australian Official Journal of Trade Marks of the Trade Mark’s acceptance for possible registration, the Opponent filed a Notice of Intention to Oppose on 10 July 2017.  The Opponent then filed a Statement of Grounds and Particulars on 3 August 2017 (‘SGP’). The SGP raised grounds of opposition under ss 42(b), 44, 60 and 62A of the Act. The Applicant filed a Notice of Intention to Defend on 6 September 2017.

Evidence

1. The Opponent filed Evidence in Support of its opposition (‘EIS’) on 12 December 2017.  This evidence consists of a declaration by Dean Kimball Reid, Director of the Opponent, made on 12 December 2017 with Annexures A to R (‘Reid Declaration’).  The Applicant did not file any Evidence in Answer.

   4.  Once the time allowed for filing evidence had ended the parties were given an opportunity to request a hearing or to file written submissions.  By letter issuing from IP Australia on 5 June 2018 the parties were notified that as a hearing had not been requested the matter would be given to a delegate of the Registrar for a decision based on the written record.  The letter indicated that the parties had one month from the date of the letter to file any written submissions upon which they wished to rely.  Neither party filed any submissions.

   5. I am a delegate of the Registrar of Trade Marks and I am to decide the opposition as required by s 55 of the Act which provides that, unless the proceedings are discontinued, dismissed, or have lapsed under s 54A 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.  

   In doing so I take account of       the written record comprised of the materials mentioned in the preceding paragraphs.

   The Opponent

2. The Opponent is an Australian company that holds the franchisor rights in Australia for a system described as ‘the Leather Doctor System’ which it operates through a related entity, The Leather Doctor Australia Pty Ltd.   

   7.  The Opponent is the owner of the trade marks listed below (‘Opponent’s Trade Marks’).  The goods and services for which the Opponent’s Trade Marks are registered are collectively referred to as the ‘Opponent’s Goods and Services’.  The Opponent provides evidence of ownership of additional trade marks however these trade marks, not being particularised in the SGP, have no relevance to the present proceeding.

Number	Trade Mark	Priority Date	Goods or Services
1200277	20 Sep 2007	Class 37: Leather and vinyl repair services
1467954	3 Jan 2012	Class 37: Leather and vinyl repair services
1815510	(‘Logo Mark’)	14 Dec 2006	Class 3: Leather and vinyl cleaning, protecting and preserving preparations; preservative cremes for leather and vinyl; softening preparations for renovating leather and vinyl (polishes); cleaning preparations, including but not limited to powdered preparations, liquid, gel, cream, cleanser or paste preparations, spray-on preparations and foam cleaning preparations; household cleaning preparations, materials and products; general purpose cleaning, polishing, and abrasive liquids, gels, creams, cleansers, pastes and powders; glass cleaning and polishing preparations; furniture polish; stain removers; antibacterial cleaning preparations; disinfectant cleaning preparations; detergents; scouring preparations for cleaning; bleaching preparations; lavatory cleaning preparations, products and materials; preparations and substances, all for kitchen and laundry use; washing powder; washing liquids; fabric conditioning preparations; fabric softeners; rinses (cleaning preparations); soaking (cleaning) preparations; ironing aids; starch for cleaning purposes; substances for dry cleaning; multipurpose household cleaning preparations; non-saponaceous cleaning preparations; ammonia for cleaning purposes; alcohol for cleaning purposes; caustic cleaning agents; cleaning oils; enzyme preparations for cleaning; outdoor cleaning products and preparations; soaps; bleaching preparations and other substances for kitchen and laundry use; scouring and abrasive preparations; solvent cleaning preparations (other than for use as part of a manufacturing process); industrial strength cleaning products; automotive cleaning preparations; windshield cleaning fluids, upholstery cleaners; chamois; carpet cleaning preparations; floor stripping/cleaning preparations; wipes (tissues) impregnated with cleaning, polishing, protecting and preserving preparations; including instructional materials sold together with the aforesaid goods Class 37: Installation, repair and maintenance services for domestic and commercial furniture and furnishings, vehicles, and goods made of or incorporating leather and/or vinyl; repair, maintenance and installation advisory and consulting services; cleaning services; mobile cleaning: mechanical and chemical cleaning services; hire of cleaning apparatus and equipment; maintenance and repair of cleaning apparatus and equipment; cleaning of leather and vinyl; upholstering and reupholstering services including but not limited to goods made of or incorporating leather and/or vinyl; restoration services; sanitation cleaning services; advisory and consulting services for all of the aforementioned services; providing information, including by electronic means and via a global computer network, about all of the aforesaid services Class 40: Treatment of materials including, but not limited to, leather and vinyl; leather and vinyl staining; working of leather and vinyl; tanning (hide or leather processing); application of protective coatings to materials leathers and vinyls; application of softening agents and preservative preparations to leather and vinyl; dressing of animal skins; stripping of leather and vinyl finishes; waterproofing of leather and vinyl; advisory and consulting services for all of the aforementioned services; providing information, including by electronic means and via a global computer network, about all of the aforesaid services

8.  The Reid Declaration contains the following claims/statements:

·     The Leather Doctor franchise system was established by a predecessor in title to the Opponent in 1986.  The Opponent’s predecessor in title commenced trading under the name the Leather Doctor in 1998.  The Leather Doctor provides a mobile service that repairs and rejuvenates motor vehicle vinyl and leather and household furniture.

·     The Opponent, its franchisees and its predecessors in title have used the name ‘The Leather Doctor’ (‘Leather Doctor Mark’) in various formats and with various additional taglines in respect of its service that repairs motor vehicle vinyl and leather and household furniture.

·     The Opponent has licensed the use of the Opponent’s Trade Marks to The Leather Doctor Australia Pty Ltd and to Care Cover Pty Ltd which provide elements of the Leather Doctor franchise system. 

·     As at the date of the declaration there are 64 franchised businesses located around Australia which provide Leather Doctor repair services.  These businesses are required to display the Leather Doctor Mark on their mobile vans from which they provide their services.

9.  The Annexes to the Reid Declaration display various marketing material that use the Leather Doctor Mark, in various formats and with various taglines.  I note that the most common form used is a form similar to the Logo Mark but without the tagline ‘Making leather live longer’ (‘Leather Doctor Logo’).  The Leather Doctor Logo also appears on vans used by the franchisors.  There does not appear to be any evidence of use of trade marks 1467954 or 1200277 on the marketing material.  The Opponent does not provide any evidence of sales made under the Leather Doctor System, number of franchisees operating at the relevant date, number of customers serviced per year, amount spent on advertising, or any third party measurement of the reputation held by the Opponent in the marketplace.

The Applicant

10.     The Applicant has not filed any evidence and as such I have no information about it other than what is set out on the Register. 

Grounds of Opposition, Onus and Standard of Proof

1. As indicated above in the SGP the Opponent nominated grounds of opposition under ss 42(b), 44, 60 and 62A of the Act. To successfully oppose the application the Opponent needs to establish one of the nominated grounds.

   12.     The onus of proof in an opposition rests upon the Opponent.[1]  The relevant standard of proof is the ordinary civil standard based on the balance of probabilities.[2]  The date at which the rights of the parties are to be determined is 21 December 2016 (‘relevant date’), being the priority date of the application in Australia.[3]

   [1] Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58, [32].

   [2] Following Pfizer Products Inc v Karam (2006) 70 IPR 599, [6]-[26], and Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156, [133].

   [3] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, 595, see also s 29(1) Trade Marks Act 1995 (Cth).

   Discussion

   Section 44

2. The relevant provisions of the Act with respect to the ground of opposition pursuant to s 44 are reproduced below:

   Section 44 - Identical etc. trade marks

   (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)it 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).

   (2)…

   (3)If the Registrar in either case is satisfied:

   (a)that there has been honest concurrent use of the 2 trade marks; or

   (b)that, because of other circumstances, it is proper to do so;

   the Registrar may accept the application for the registration of the applicant's trade mark subject to any conditions or limitations that the Registrar thinks fit to impose. If the applicant's trade mark has been used only in a particular area, the limitations may include that the use of the trade mark is to be restricted to that particular area. 

   Note:  For limitations see section 6.

   (4)If the Registrar in either case is satisfied that the applicant, or the applicant and the predecessor in title of the applicant, have continuously used the applicant's trade mark for a period:

   (a)beginning before the priority date for the registration of the other trade mark in respect of:

   (i)              the similar goods or closely related services; or

   (ii)             the similar services or closely related goods; and

   (b)ending on the priority date for the registration of the applicant's trade mark;

   the Registrar may not reject the application because of the existence of the other trade mark.

   Note 1: An authorised use of the trade mark by a person is taken to be a use of the trade mark by the owner of the trade mark (see subsection 7(3)).

   Note 2: For predecessor in title see section 6.

   Note 3: For priority date see section 12.

   Section 10 - Definition of deceptively similar

   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.

   14. To successfully oppose the application pursuant to s 44 of the Act the Opponent must establish the requirements of s 44(1), i.e. that at least one of the trade marks upon which it relies:

   ·     has a priority date which is earlier than that of the Trade Mark (‘the first requirement’);

   ·     is substantially identical with or deceptively similar to the Trade Mark (‘the second requirement’); and

   ·     is in respect of similar goods, and/or services which are closely related to, the Applicant’s Goods (‘the third requirement’).

3. In the event that each of these requirements is satisfied by the Opponent it may still be possible for the Registrar to accept the application (or allow it to proceed to registration) if the Registrar is satisfied, pursuant to ss 44(3) and 44(4) of the Act, that there has been honest concurrent use of the Trade Mark, other circumstances which would make registration of the Trade Mark proper, or that the Applicant has continuously used the Trade Mark beginning before the priority date of the Opponent’s relied upon mark.

4. The Opponent has particularised the ground of opposition in the SGP by reference to the Opponent’s Trade Marks.  Each of the Opponent’s Trade Marks has a priority date that is earlier than the priority date of the Trade Mark. 

   Substantially identical and/or deceptively similar

5. I will now consider whether the Trade Mark is substantially identical to the Opponent’s Trade Marks.  When considering ‘substantial identity’ in Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd Windeyer J said:

   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.[4]

   [4] (1963) 109 CLR 407, [12].

   18.       The Trade Mark and the Opponent’s Trade Marks are set out below:

   19.       On a side by side comparison there are clear differences between the respective trade marks, indeed the only common element is the shared use of the word ‘leather’ in similar (though not identical) font and format.  The differences between the respective trade marks are sufficient for me to conclude that the respective trade marks are not substantially identical.  I move then to consider whether the Trade Mark and Opponent’s Trade Marks are deceptively similar.

   20.       The principal authority for guidance in determining whether trade marks are deceptively similar also comes from the judgment of Windeyer J in Shell Co (Aust) Ltd v Esso Standard Oil (Aust) Ltd:

   On the question of deceptive similarity, a different comparison must be made from that which is necessary when substantial identity is in question. The marks are not now to be looked at side by side. The issue is not abstract similarity, but deceptive similarity.

   Therefore the comparison is the familiar one of trade mark law. It is between, on the one hand, the impression based on recollection of the plaintiff’s mark that persons of ordinary intelligence and memory would have; and, on the other hand, the impressions that such persons would get from the defendant’s [trade mark].[5]

   [5] Ibid [13].

   21.       Jacobson J in Millennium & Copthorne International Limited v Kingsgate Hotel Group Pty Ltd summarised the principles of deceptive similarity with reference to the authorities as follows:

   Without seeking to reformulate the various statements of principle stated in the Full Court authorities, it is sufficient for present purposes to identify the critical elements which seem to me to inform the issue of deceptive similarity in the present case. There are nine elements.

   First, the judgment of likelihood of deception is a practical one. It requires an assessment of the effect of the challenged mark on the minds of potential customers: Woolworths[6] at [49]; Australian Woollen Mills[7] at 658.

   Second, the question of deceptive similarity is not to be decided by a side-by-side comparison. It is to be determined by a comparison of the impression based on recollection of the opponent’s mark that persons of ordinary intelligence and memory would have, and the impression that those persons would get from the opposed trade mark: Crazy Ron’s[8] at [73]; Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd [1963] HCA 66; (1963) 109 CLR 407 at 415 per Windeyer J.

   Third, allowance must be made for imperfect recollection: Crazy Ron’s at [74].

   Fourth, the effect of the spoken description must be considered: Woolworths at [49]; Crazy Ron’s at [75]; Australian Woollen Mills at 658.

   Fifth, it is necessary to show a real tangible danger of deception or confusion: Woolworths at [43] and [50]; Crazy Ron’s at [76]; Southern Cross Refrigerating[9] at 594 – 595.

   Sixth, 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 the two products come from the same source: Woolworths at [50]; Southern Cross Refrigerating Co at 595. This test sets a lower threshold than that which is required to establish that conduct is likely to mislead or deceive under s 18 of Schedule 2 of the Competition and Consumer Act 2010 (Cth): see McWilliam's Wines Pty Ltd v McDonald's System of Australia Pty Ltd [1980] FCA 159; (1980) 33 ALR 394 at 398 per Smithers J.

   Seventh, all surrounding circumstances must be taken into consideration. The circumstances include those in which the marks will be used, and in which the goods or services will be bought and sold, as well as the character of the probable acquirers of the goods and services: Woolworths at [50]; Crazy Ron’s at [86] – [89]; Southern Cross Refrigerating at 595.

   Eighth, the question of whether there is a likelihood of confusion is not to be answered by reference to the manner in which a party has used the mark, but by reference to what an applicant can do. That is to say, the use to which it can properly put the mark if registration is obtained: Woolworths at [50]; Berlei Hestia Industries Ltd v The Bali Company Inc [1973] HCA 43; (1973) 129 CLR 353 at 362 per Mason J.

   Ninth, if a registered trade mark includes words which can be regarded as an ‘essential feature’ of the mark, another mark that incorporates those words may cause a tangible danger of deception or confusion by reason of consumers retaining an imperfect recollection of those words: Crazy Ron’s at [79]. However, care must be taken to not too readily characterise words in a composite trade mark as an ‘essential feature’ because to do so may effectively convert a composite mark into something different: Crazy Ron’s at [100].[10]

   [6] Registrar of Trade Marks v Woolworths Ltd [1999] FCAFC 1020.

   [7] Australian Woollen Mills Ltd v FS Walton & Co Ltd [1937] HCA 51; (1937) 58 CLR 641.

   [8] Crazy Ron’s Communications Pty Ltd v Mobileworld Pty Ltd [2004] FCAFC 196; (2004) 209 ALR 1.

   [9] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592.

   [10] [2012] FCA 1022, [38]-[46].

1. In the present case, there are some minor similarities in the manner in which the marks (in particular the Trade Mark and Logo Mark) are set out (being light colored words on a darker background in a similar font), but such similarities are not particularly significant.  The key similarity between all the marks is the shared word ‘leather’.  In the context of the goods and services for which the Trade Mark and the Opponent’s Trade Marks are registered/sought to be registered (being upholstery [leather being a common material for upholstery] and leather and vinyl cleaning services and products) the word ‘leather’ is both descriptive and common to the trade.[11]  In such circumstances the presence of the common element ought to be given less weight in considering whether the respective marks are deceptively similar. 

   [11] See Deckers Outdoor Corporation v B&B McDougal [2006] ATMO 5, [34].

2. Stephen J observed[12] in Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd that:

   There is a price to be paid for the advantages flowing from the possession of an eloquently descriptive trade name. Because it is descriptive it is equally applicable to any business of a like kind, its very descriptiveness ensures that it is not distinctive of any particular business and hence its application to other like businesses will not ordinarily mislead the public. In cases of passing off, where it is the wrongful appropriation of the reputation of another or that of his goods that is in question, a plaintiff which uses descriptive words in its trade name will find that quite small differences in a competitor’s trade name will render the latter immune from action (Office Cleaning Services Ltd. v. Westminster Window and General Cleaners Ltd. (1946) 63 RPC 39, at p 42, per Lord Simonds). As his Lordship said (1946) 63 RPC, at p 43, the possibility of blunders by members of the public will always be present when names consist of descriptive words - “So long as descriptive words are used by two traders as part of their respective trade names, it is possible that some members of the public will be confused whatever the differentiating words may be.” The risk of confusion must be accepted, to do otherwise is to give to one who appropriates to himself descriptive words an unfair monopoly in those words and might even deter others from pursuing the occupation which the words describe.[13]

   [12] Albeit in relation to trade practices.

   [13] 140 CLR 216, 229.

3. There are numerous differences between the respective marks, including the presence of the letters ‘FX’ and the words ‘Style Quality Satisfaction’ in the Trade Mark. A finding of deceptive similarity in this case would in effect infer that the Opponent has a monopoly on the use of the term ‘leather’ in respect of leather and vinyl cleaning services and other similar services and closely related goods. The Opponent does not have such a monopoly. Any confusion that might occur stems from the use of the descriptive term in the respective marks and not from the deceptive similarity of the parties’ trade marks within the meaning of the Act. It is not necessary to consider whether any of the Opponent’s Trade Marks are registered in respect of similar goods and/or services closely related to the Applicant’s Goods; even if I conclude that the respective marks were registered for similar goods and/or closely related services I would not find the marks to be substantially identical or deceptively similar for the reasons set out above.

4. I find that the Opponent has failed to establish the ground of opposition under s 44.

   Section 60

5. Section 60 of the Act is reproduced below:

   Section 60 - Trade 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.

6. To establish a ground of opposition under s 60 an opponent must demonstrate that as at the relevant date there was another trade mark which had acquired a reputation in Australia amongst a significant or substantial number of persons in the relevant market such that use of the trade mark would be likely to deceive or cause confusion.[14]

   [14] The present paragraph and the following paragraphs summarizing the requirements under s 60 of the Act are paraphrased from the decision of the Registrar’s Delegate in Australian Boutique Markets Pty Ltd v Rachael Zelensky and Jeffrey Zelensky [2013] ATMO 97.

7. In McCormick & Co Inc v McCormick, Kenny J considered what is intended by the word ‘reputation’ as used in s 60. Her Honour consulted the Macquarie Dictionary and on the basis of the definition provided concluded that it was ‘the recognition of the [trade mark] by the public generally’.[15]  Her Honour quoted with approval the following words of Lockhart J in Re ConAgra Inc v McCain Foods (Aust) Pty Ltd:

   [R]eputation within the jurisdiction may be proved by a variety of means including advertisements on television or radio, or in magazines and newspapers within the forum. It may be established by showing constant travel of people between other countries and the forum and that people within the forum, (whether residents there or persons simply visiting there from other countries) are exposed to the goods of the overseas owner …[16]

   [15] [2000] FCA 1335, [81].

   [16] (1992) 33 FCR 302, 343.

8. On the subject of reputation Kenny J also referred to the Hugo Boss decision, where the Registrar’s delegate observed:

   [I]t is true that the assessment of the reputation of a trade mark goes far beyond mere examination of sales or turnover of goods sold under that trade mark and contemplation of the advertising and promotional figures.

   As regards a trade mark, its reputation derives both from the quantum of sales under that mark and also its esteem, or image, projected by that trade mark. The quantum of sales, advertising and promotion contributes to the ‘recognition’ component of the trade mark’s reputation. The credit, image and values projected by a trade mark attaches to the ‘esteem’ component of the reputation as do the public events and other trader’s marks with which [the] owner of the trade marks in question chooses to associate the trade marks via sponsorships, cross-promotions, ‘contra deals’ and so forth.

   It follows that a trade mark used in relation to goods with comparatively low sales may have a high and strong reputation by virtue of the high credit or esteem in which it is held, or, conversely, that a trade mark which has very high sales may have a strong reputation notwithstanding the lack of esteem that attaches to it. The particular popular images, or sets of values, that attach to the trade mark are also, therefore, important parts of the reputation of the trade mark and may be as strong an associative force in the minds of the public as the association of the trade marks with the goods or services themselves.[17]

   [17] Hugo Boss AG v Jackson International Trading Co Kurt D Bruhl Gesellschaft MbH & Co KG (1999) 47 IPR 423, 426.

9. As stated above, in assessing reputation under s 60, what constitutes a significant or substantial number of persons in the relevant market must be considered. The case of Le Cordon Bleu BV v Cordon Bleu International Ltee[18] was decided under s 28(a) of the (now repealed) Trade Marks Act 1955.  That provision did not refer to ‘reputation’ at all, only that use of the impugned trade mark would be ‘likely to deceive or cause confusion’.  Nevertheless the words of Heerey J provide some guidance:

   What is ‘significant’ or ‘substantial’ will depend on the nature of the goods or services in question. For some highly specialised products, awareness among a few thousand persons, or even less, might be sufficient … We are here concerned with foodstuffs sold in supermarkets, delicatessens, milk bars and other retail outlets. The relevant market is virtually the entire Australian population from early teenage years onwards.[19]

   [18] (2000) 50 IPR 1.

   [19] Ibid 20. Heerey J’s decision was overturned on appeal to the Full Federal Court, although not on the point quoted. Indeed the court specifically noted that his approach contained no error; see Renaud Cointreau v Cordon Bleu International Ltee [2001] FCA 1170, [75].

10. Furthermore, in practice, once the requisite reputation is demonstrated, the likelihood of deception or confusion increases the more closely the trade marks resemble each other.[20]

    [20] Qantas Airways Limited v Edwards [2016] FCA 729 at [142].

11. The Opponent has particularised the ground of opposition in the SGP in the manner set out below: 

    The Opponent uses the trade mark THE LEATHER DOCTOR logo and various therefor including:

    [displays Leather Doctor Logo and Logo Mark]

    (‘THE LEATHER DOCTOR LOGO trade marks’)

    The opponent has used it’s the LEATHER DOCTOR logo trade marks in relation to goods and services the same as and similar to the goods covered by the opposed application since before the priority date of the opposed application.  As at the priority date of the opposed application, the opponent’s THE LEATHER DOCTOR logo trade marks had acquired a significant reputation through use of the trade marks in Australia.  As a result of this reputation, use of the opposed trade may by the applicant on the goods covered by the opposed application would be likely to deceive or cause confusion.  

12. While noting the limited evidence provided by the Opponent of sales and advertising expenditure for its business, I am satisfied on the evidence before me that the Leather Doctor Logo had, before the relevant date, acquired a very limited reputation in Australia for leather and vinyl cleaning services, sufficient for the requirements under s 60(a) of the Act. I reach this conclusion noting the length of time the Opponent and its predecessors in title have used the Leather Doctor Logo and the number and geographic spread of franchises displaying the Leather Doctor Logo on their mobile vans. As discussed in paragraph 10 above, in the absence of any significant evidence of use of any of the other marks referred to in the SGP separate from the Leather Doctor Logo, I do not reach a similar finding in respect of any other marks.

13. It is not sufficient that the Opponent merely establishes that its trade marks have a reputation; the Registrar must also be satisfied that because of that reputation the use of the Trade Mark would be likely to deceive or cause confusion. Discussions and decisions on the subjects of deception and confusion are legion and a good number provide relevant comments in relation to a consideration of deception and confusion for the purposes of s 60. In a case concerning infringement and passing off, Australian Woollen Mills Limited v F S Walton and Company Limited, Dixon and McTiernan JJ said the following:

    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 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 observations of men considered in the mass affords the standard.[21]

    [21] (1937) 58 CLR 641, 658.

14. In Registrar of Trade Marks vWoolworths Ltd French J highlighted the following further matters concerning confusion:

    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.

    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.[22]

    [22] (1999) 45 IPR 411, 428. These considerations by French J are based on principles set out by Kitto J in Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, 594-5.

15. In Pottle Productions Inc v Rute Ithalat Ve Ihracat Anonim Sirketi the delegate observed that:

    The assessment of the likelihood of deception or confusion under section 60 is informed by the strength of the reputation of the Opponent’s trade mark(s), the inherent distinctiveness thereof, the degree of similarity between the trade marks under consideration and the nexus or connection between the goods and/or services of the parties. Each of these is a variable and it is possible that a trade mark’s reputation might be sufficiently strong and the degree of similarity to an opposed trade mark be so great (particularly where the trade marks are inherently distinctive) that confusion or deception will be a likelihood where very little, if any, nexus or connection exists between the goods and/or services under consideration.[23]

    [23] [2012] ATMO 124 at [40].

16. While it is not necessary to show that the marks are deceptively similar for the purposes of an opposition under s 60, as stated in Qantas Airways Limited v Edwards, ‘the degree of similarity between the allegedly conflicting marks will be a relevant consideration to be taken into account when considering the likelihood of confusion resulting from use of the opposed mark.’[24]

    [24] [2016] FCA 729 at [142].

17. In the present case, to the extent that the trade mark and Leather Doctor Logo are similar, it is largely due to the presence of the common element ‘leather’ which is descriptive in respect of the Applicant’s Goods and the services for which the Leather Doctor Logo has a limited reputation.  I refer to the statements made by Stephen J in Hornsby Building Information Centre Pty Limited v Sydney Building Information Centre Limited[25] extracted at paragraph 23 above regarding the risk of confusion that must be accepted as a price to be paid for the advantages of a descriptive trade name.  In the present case I am not satisfied that any confusion that could arise between the Trade Mark and the Leather Doctor Logo would arise because of the (very limited) reputation of the Leather Doctor Logo, as opposed to the shared use of the descriptive term ‘leather’ in respect of upholstery and leather cleaning services.

    [25] (1978) 140 CLR 216, 229.

18. I find that the Opponent has failed to establish the ground of opposition pursuant to s 60 of the Act.

    Section 42

19. Section 42 of the Act is reproduced below:

    42 - Trade mark scandalous or its use contrary to law

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

    (a) the trade mark contains or consists of scandalous matter; or

    (b) its use would be contrary to law.

20. The Opponent pressed this ground of opposition solely on the basis that the use of the Trade Mark would be contrary to law (s 42(b)).  The onus is on the Opponent to establish that use of the Trade Mark by the Applicant would be, rather than could be, contrary to law on the balance of probabilities.[26]  The relevant time for assessing whether an application is contrary to law is at the relevant date but ‘looking forward to prospective conduct after registration’.[27]

    [26] Advantage Rent-a-Car Inc v Advantage Car Rental Pty Ltd [2001] FCA 683.

    [27] Time Warner Entertainment Co LP v Stepsam Investments Pty Ltd [2004] 59 IPR 343, 353.

21. The Opponent has particularised the ground of opposition in the SGP as follows: 

    Use of the opposed trade mark would be contrary to law because the opponent is the owner of a prior reputation in it’s the LEATHER DOCTOR logo trade marks in Australia in relation to goods and services the same as and similar to the goods covered by the cited application in Australia

    The opponent’s reputation in THE LEATHER DOCTOR logo trade marks has accrued through extensive use of the trade marks in Australia. Due to the opponent’s reputation in the trade marks, use of the opposed trade mark on goods covered by the opposed application would be likely to mislead or deceive consumers, thereby contravening section 18 of the Australian Consumer Law (being schedule 2 of the Competition and Consumer Act 2010 (Cth)).

    Use of the opposed trade mark would also constitute passing off in that it would result in the applicant passing off or threatening to pass off:

    1. the applicant’s goods as those of the opponent;

    2. the applicant’s goods as being of the same kind or quality as those of the opponent

    3. the applicant’s goods as being supplied by or under or with the authority of the opponent, or as having the approval of the opponent and/or

    4. the applicant as being the opponent or has having the approval of the opponent or as being associated in trade with the opponent.

22. As previously stated the Opponent has failed to establish a ground of opposition under s 60 of the Act. The test for misleading or deceptive conduct under s 18 of the Australian Consumer Law (‘ACL’) is a more stringent one than that for deception or confusion under s 60,[28] and consequently I find that the Opponent has also failed to establish that the Applicant’s use of the Trade Mark would be contrary to s 18 of the ACL.

    [28] See, e.g.: Ownit Homes Pty Ltd v Ownit Conveyancing Pty Ltd [2005] ATMO 47, [36]; Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191, 198.

23. Paraphrasing the statement of the Registrar’s Delegate in A G Professional Hair Care Products Ltd v Geagroup Invest SRL[29], where a trade mark does not run afoul of s 18 of the ACL, neither will it run afoul of s 29 of the ACL. In Pacific Publications Pty Ltd v IPC Media Pty Ltd, Beaumont J considered—in connection with the superseded Trade Practices Act1974 (‘TPA’)—that ‘the Court’s conclusion on s 52 would necessarily carry with it a conclusion on s 53(c) and (d)’.[30] Sections 52 and 53 of the TPA were, respectively, the equivalent provisions to ss 18 and 29 of the ACL. Hill J in Re Equity Access Pty Ltd v Westpac Banking Corporation also addressed the relationship between s 52 of the TPA and passing off. His Honour considered that:

    The scope for the operation of s 52 will thus be broader than that involved in the tort of passing off so that in a case such as the present where the claim is for the protection of the reputation in a name against the use of that name by another, failure to succeed under s 52 or s 53 will invariably mean that proceedings for passing off would likewise fail.[31]

    [29] [2014] ATMO 65, [50].

    [30] [2003] FCA 104, [107].

    [31] [1989] FCA 506, [40] (citations omitted).

24. For these reasons I am not satisfied that use of the Trade Mark by the Applicant would be contrary to law. Therefore, the Opponent has failed to establish the ground of opposition under s 42(b).

    Section 62A

25. Section 62A of the Act is reproduced below:

    62A Application made in bad faith

    The registration of a trade mark may be opposed on the ground that the application was made in bad faith.

26. The Explanatory Memorandum to the Trade Marks Amendment Bill 2006 provided some non-exhaustive examples of applications made in bad faith:

    ·persons who monitor new property developments, register the names of new developments as trade marks for a number of services and then threaten the property developers with trade mark infringement proceedings unless the developers licence or buy the trade marks;

    ·persons who have a history of applying for trade marks that are deliberate misspellings of other registered trade marks;

    ·persons who identify trade marks used overseas but with no Australian use as yet who then apply to register the trade marks in Australia for the express purpose of selling them to the overseas owners.

1. The case of Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) is a current leading Australian authority on s 62A. In that case, Dodds-Streeton J made the following comments, quoting from Harrison’s Trade Mark Application[32]:

   Clearly the court, when considering bad faith, cannot apply a purely subjective test, called by Lord Hutton ‘the Robin Hood test’. The dishonest person or one with low standards cannot be permitted to obtain trade mark registrations in circumstances where a person abiding by a reasonable standard would not. The registration of a trade mark is designed to enable bona fide proprietors to protect their proprietary rights without having to prove unfair trading. Registration is not provided to help those with low moral standards.

   … The words ‘bad faith’ suggest a mental state. Clearly when considering the question of whether an application to register is made in bad faith all the circumstances will be relevant. However the court must decide whether the knowledge of the applicant was such that his decision to apply for registration would be regarded as in bad faith by persons adopting proper standards.[33]

   [32] [2004] EWCA Civ 1028; [2005] FSR 10.

   [33] [2012] FCA 81, [147].

2. Her Honour continued later in the same decision:

   The formulation in United Kingdom authority of bad faith as falling short of the standards of acceptable commercial behaviour observed by reasonable and experienced persons in a particular area is, in my view, an apt touchstone. An overly literal application may, however, tend to negate the relevance attributed to the applicant’s mental state in the combined test preferred in Harrison.

   Further, in my view, mere negligence, incompetence or a lack of prudence to reasonable and experienced standards would not, in themselves, suffice, as the concept of bad faith imports conduct which, irrespective of the form it takes, is of an unscrupulous, underhand or unconscientious character.[34]

   [34] Ibid [165]-[166].

3. The Opponent has particularised this ground of opposition in the SGP as follows:

   At the time of filing the opposed application, the applicant was aware of the opponent’s prior rights in THE LEATHER DOCTOR logo trade marks in Australia.

4. The onus is on the Opponent to establish bad faith and it will not be found easily given the serious nature of the allegation.[35] Based on the evidence before me I cannot conclude that the decision of the Applicant to adopt and seek to register a mark containing the word ‘leather’ in respect of upholstery, was a decision made to take advantage of the reputation of the Leather Doctor Logo or Logo Mark, as opposed to the use of the word ‘leather’ to describe the leather upholstery products to be provided under the mark. Furthermore the Opponent provides no evidence about the Applicant that would suggest that the Applicant was aware of the Opponent at the relevant date. In circumstances where the evidence in support of the s 62A ground of opposition is very limited and the Opponent bears the onus, I am not satisfied the Applicant’s conduct in filing the application was unscrupulous, underhanded or unconscientious in character. Consequently I find that the Opponent has failed to establish the ground of opposition under s 62A.

   [35] Hard Coffee Pty Ltd v Hard Coffee Main Beach Pty Ltd [2009] ATMO 26, [12].

   Decision

5. The Opponent has failed to establish any of the grounds of opposition it nominated in the SGP.  Trade mark application no. 1817125 may proceed to registration not less than 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 either the appeal is withdrawn or discontinued.  Otherwise the disposition of the application should be in accordance with the Court’s order or direction.

   Nicholas Smith

   Hearing Officer

   Oppositions and Hearings

   3 September 2019