Monster Energy Company v Fernbrew Pty Limited

[2018] ATMO 125

TRADE MARKS ACT 1995

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

Re:Opposition by Monster Energy Company to registration of trade mark application no. 1762086 (33) – REAL BEAST - in the name of Fernbrew Pty Limited

Delegate:	Bianca Irgang
Representation:	Opponent: Stephen Rebikoff of counsel instructed by Davies Collison Cave Applicant: Sean McManis of Shelston IP Pty Ltd
Decision:	2018 ATMO 125 Trade Marks Act 1995(Cth)- Section 52 opposition: sections 42(b), 44 and 60 pressed – no ground of opposition established.

Background

1. Fernbrew Pty Limited (‘the applicant’), filed trade mark application number 1762086 on 1 April 2016 in class 33 of the International Classification of Goods and Services. Current details of the application are set out below.

   Trade mark:  Real Beast (‘the Trade Mark’)

   Trade mark application no: 1762086            

   Filing Date:  1 April 2016

   Specification:  Class 33: Alcohol for drinking; Alcoholic beverages (except beer); Alcoholic beverages (except beer) containing more than 1.15% of alcohol by volume; Alcoholic cocktails containing more than 1.15% of alcohol by volume; Alcoholic drinks (except beer) containing more than 1.15% of alcohol by volume; Alcoholic mixed drinks containing more than 1.15% of alcohol by volume; Carbonated beverages (alcoholic, except beers); Cocktails (alcohol content of more than 1.15% (by volume)); Drinks containing 1.15% of alcohol or more by volume; Pre-mixed alcoholic beverages, other than beer-based

2. Acceptance of the application for possible registration was published in the Australian Official Journal of Trade Marks on 18 August 2016. Subsequently Monster Energy Company (‘the opponent’) filed its Notice of Intention to Oppose registration followed by its Statement of Grounds and Particulars[1].

   [1] which together constitute ‘the Notice’

3. The applicant then filed its Notices of Intention to Defend. Thereafter the opponent and the applicant respectively filed evidence in accordance with the provisions of the Trade Mark Regulations 1995 (‘the Regulations’).

4. I heard the opposition in Canberra as a delegate of the Registrar of Trade Marks on 5 March 2018. The applicant was represented by Sean McManis of Shelston IP Pty Ltd. The opponent was represented by Stephen Rebikoff of Counsel instructed by Davies Collison Cave.

   Grounds of Opposition and Onus

5. The Notice nominated a number of grounds of opposition under the Trade Marks Act 1995 (‘the Act’) however, only those grounds of opposition under sections 42(b), 44 and 60 were pursued at the hearing. The onus is upon the opponent to establish one or more of its grounds of opposition. The Full Bench in Telstra Corporation Limited v Phone Directories Company Pty Ltd[2] affirmed the approach in Pfizer Products Inc. v Karam[3] where Gyles J referred to the standard of proof required in these matters in terms of a ‘balance of probabilities’. Should the opponent establish one ground of opposition in relation to all of the applicant’s goods, there is no requirement for me to consider the other grounds of opposition.

   [2] [2015] FCAFC 156, [133]

   [3] [2006] FCA 1663, [26]

   Evidence

6. The evidence in this matter consists of the following declarations:

   Evidence in Support

   ·Declaration of Rodney Cyril Sacks ( ‘Sacks 1’) dated 27 February 2017

   ·Declaration of Elizabeth Kate Godfrey (‘Godfrey’) dated 8 March 2017 with the following declarations as exhibits:

   oDeclaration of Rebecca Lee Dunbar  (‘Dunbar’) dated 8 August 2012

   oDeclaration of Danielle Jade Roberts  (‘Roberts’) dated 9 July 2012

   oDeclaration of Adrian Heath Hunter  (‘Hunter’) dated 11 October 2012

   Evidence in Answer

   ·Declaration of Rex D’Aquino (‘D’Aquino’) dated 6 June 2017

   ·Declaration of Sean Francis McManis (‘McManis’) dated 7 June 2017

   Evidence in Reply

   ·Declaration of Rodney Cyril Sacks ( ‘Sacks 2’) dated 2 August 2017

   ·Declaration of Sam Anthony Pontrelli (‘Pontrelli’) dated 7 August 2017

   ·Declaration of Samuel Peter Thiele (‘Thiele’) dated 11 August 2017

   Discussion

   Section 60 - Reputation in Australia

7. Section 60 of the Act provides:

   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.

8. To establish the ground of opposition under section 60 the opponent is relying predominantly on its use of and reputation in the trade marks below:

   MONSTER ENERGY                         

   (‘opponent’s MONSTER trade marks’)

   UNLEASH THE NITRO BEAST!      UNLEASH THE ULTRA BEAST!        

   REHAB THE BEAST!      PUMP UP THE BEAST!  

   UNLEASH THE BEAST!

   (opponent’s ‘BEAST tag line trade marks’)

9. The opponent’s MONSTER trade marks (as well as many other ‘MONSTER ENERGY’ trade marks) have also obtained registration in a number of different classes[4]. Unlike section 44 of the Act, section 60 does not require that the goods and services upon which the opponent uses its trade mark be of a specified standard of similarity with the goods of interest to the applicant, nor is there a requirement that the opponent’s trade marks be substantially identical or deceptively similar to the Trade Mark. However, I note that the goods of interest of both the opponent and the applicant are beverages.

   [4] Exhibit RCS-02 accompanying Sacks 1

10. It is for me to determine whether the opponent has established that before 1 April 2016 any of the opponent’s trade marks were recognized by the relevant market, or at least by a significant number of persons in Australia and whether because of that, the use by the applicant of the Trade Mark would be likely to cause confusion.

11. The principles relevant to the assessment of the likelihood of confusion, etc, were set out by French J in Registrar of Trade Marks v Woolworths: [5]

    (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.

    [5] [1999] FCA 1020 [50]

12. Mason J observed in Berlei Hestia Industries Ltd v The Bali Company Inc:[6]

    “...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.”

    [6] [1973] HCA 43; (1973) 129 CLR 353, 362

13. Reputation is to be assessed according to the test set out in McCormick & Company Inc v McCormick[7] by Kenny J:

    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?

    [7] [2000] FCA 1335 [81]

14. Sacks 1 states that since the launch of the original MONSTER energy drink in 2002, the opponent has used the trade mark “UNLEASH THE BEAST!”. According to Sacks 1 the opponent’s MONSTER ENERGY branded energy drinks containing taurine and caffeine are, by unit value and dollar value, the best-selling energy drinks in the United States and the second best-selling worldwide. Mr Rodney Cyril Sacks, the Chairman and Chief Executive Officer of Monster Beverage Corporation and its subsidiaries including the opponent, asserts that the opponent first sold its beverages branded with a MONSTER trade mark in Australia in 2006 via an Australian company named Bickford’s Australia Pty Ltd (‘Bickford’s’).

15. Following the launch of Bickford’s MONSTER energy drinks the opponent commenced selling its own energy drinks bearing the opponent’s trade marks in Australia in July 2009. It is on the can of these MONSTER branded energy drinks that the applicant also uses its “UNLEASH THE BEAST!” trade mark. Exhibits RCS-9, RCS-11, RCS-12 and RCS-13 accompanying Sacks 1 demonstrate that the trade mark “UNLEASH THE BEAST!” has also been used extensively in connection with the promotion of the opponent’s energy drinks through advertising on point of sale materials and promotional items such as clothing, condom packaging and other merchandise. 

16. Since July 2009 the opponent’s energy drinks bearing its various trade marks have been distributed by Schweppes Australia Pty Ltd. The opponent’s energy drinks have been distributed to and sold in more than 4,000 retail outlets throughout Australia including Woolworths, Coles, IGA, 7 Eleven, Caltex, Mobil and Shell petrol stations. In March 2011 the opponent released variants of its energy drinks which featured nitrous oxide gas technology that featured the “UNLEASH THE NITRO BEAST!” trade mark on the packaging. Following this new product the opponent released a non-carbonated, low sugar recovery drink in August 2012 which featured the opponent’s trade mark “REHAB THE BEAST!”. 

17. The world-wide sales of goods bearing the opponent’s respective trade marks are very substantial particularly given the relatively low cost of the individual units. From 2009 until 2015 the total sales of those energy drinks in Australia is also considerable[8]. The marketing associated with the goods bearing the opponent’s trade marks is not typical in that the majority of the opponent’s marketing budget is spent on the sponsorship of athletes and sporting events. The opponent has spent billions on world-wide advertising and significant advertising expenditure has occurred in Australia. Mr Sacks provides the opponent’s advertising figures for Australia from 2009 until December 2015 in relation to goods bearing the opponent’s various trade marks. The figures are substantial.

    [8] Sacks 1 at [22] and [35]

18. Taken all together, I am satisfied that the opponent’s MONSTER trade marks had a very significant reputation in Australia for energy drinks before the priority date of the Trade Mark. How much of this significant reputation is vested solely in the UNLEASH THE BEAST!, UNLEASH THE NITRO BEAST! and REHAB THE BEAST! trade marks is, perhaps, more unclear since there is limited evidence of these tag lines being used in isolation from the opponent’s distinctive MONSTER trade marks. However, given that the MONSTER branded energy drinks are most often sold in packaging that also bears a  BEAST tag line trade mark, I am satisfied that the opponent does have a reputation in its tag line trade marks which incorporate the word BEAST, most notably; ‘UNLEASH THE BEAST!’.

19. It now needs to be determined if, given this reputation in Australia, use of the Trade Mark by the applicant would be likely to deceive or cause confusion. This is the main point of contention between the two parties.

20. The applicant has agreed that the opponent has a significant reputation in its MONSTER trade marks for energy drinks. However, the applicant has argued that the opponent does not have a reputation solely in the word BEAST such that the use of the applicant’s Trade Mark on alcoholic beverages would deceive or cause confusion. Mr McManis also argued that the Trade Mark is for the two words “REAL BEAST” and that there are substantial differences between the opponent’s respective trade marks and the Trade Mark. He also directed me to three previous decisions made by Hearing Officers which have addressed similar issues.

21. In particular I turn to the earlier decision in Monster Energy Company v USA Nutraceuticals Group Inc[9]where the Hearing Officer commented at paragraph 43 to 45:

    Another relevant factor is, as Ms Ryan submitted, the degree of distinctiveness of the element or elements shared by the parties’ respective trade marks under comparison, in this case the element BEAST.

    Bearing these factors in mind, the likelihood of relevant deception or confusion is in my view low for the following reasons.  Firstly there are the immediately obvious visual, aural and semantic differences between the parties’ marks when considered as wholes.  The marks as wholes do not look alike at all, nor do they sound alike, in my estimation.  The Stylised Tagline contains more words and twice the number of syllables.  Unlike the Opposed Mark it forms a self contained and relatively coherent phrase.  Moreover the somewhat unusual manner in which the Stylised Tagline is rendered and the addition of an exclamation mark further distinguish it from the Opposed Mark.  I agree with Ms Ryan’s submission that it is important to consider possible notional use of the Opposed Mark, that is to consider “what the [A]pplicant can do if registration is obtained.”[10]  However there is no evidence before me suggesting the Applicant’s intention is to mimic the manner in which the Stylised Tagline is rendered and judicial commentary in this regard indicates I must assume use of an opposed mark in a “fair and reasonable” manner”[11] and “by reference to the use to which [the Applicant] can properly put [his] trade mark”[12] rather than assume the likelihood of use apparently based on bad faith.

    When spoken, I believe the phrase “unleash the beast!” and the words “beast mode” are also readily distinguishable on the face of it.  It is generally accepted, I think, that the first word of a trade mark tends to be the most readily recalled and in the present case the word “beast” is the last word of the phrase “unleash the beast!” and the first word of the Opposed Mark.  To the extent that the Stylised Tagline would be “imperfectly recollected” by consumers I do not think it is likely to be recollected by the word “beast” alone.  In this regard I do not agree with Ms Ryan that the word “beast” alone “is clearly the essential and memorable element of both marks” when the marks are considered as wholes.

    [9] [2017] ATMO 22

    [10] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, Kitto J at 595.

    [11] As Evershed J put it in Smith Hayden & Co Ltd’s Application (1946) 63 RPC 97 at 101.

    [12] As Mason J put it in Berlei Hestia Industries Ltd v Bali Co Inc (1973) 129 CLR 353 at 362.

22. I agree with the Hearing Officer’s above reasoning. In considering the respective trade marks it becomes clear that the only similarity between them is the word BEAST. Mr Rebikoff has argued that the aggressive language on the opponent’s energy drinks coupled with the MONSTER trade marks and the BEAST tag line trade marks created a similarity of idea, impression and language that would give rise to a real risk that consumers might have cause to wonder that the Trade Mark used on the applicant’s goods was somehow related to the opponent’s energy drinks. He cited the case of Tran v Meldrum[13] in support of his argument. However, I am not persuaded by this reasoning.

    [13] (1999) 44 IPR 233

23. The Trade Mark is for two words REAL and BEAST. The opponent’s BEAST tag line trade marks are for various multiword expressions. There are significant differences between the respective trade marks which outweigh the common word ‘BEAST’. When the trade marks are considered as wholes, as they must be, I am not satisfied that use of the Trade Mark will lead a significant number of consumers to experience a reasonable doubt[14] as to the existence of some sort of connection between the opponent’s BEAST tag line trade marks and the Trade Mark.

    [14] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 at 594-5

24. The Opponent has accordingly not established its ground of opposition under s 60.

    Section 42(b) – Contrary to Law

25. Section 42(b) of the Act is reproduced below:

    Trade mark scandalous or its use contrary to law

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

    (a) …

    (b) its use would be contrary to law.

26. The opponent argued that the conduct of the applicant in offering alcoholic beverages under the Trade Mark would constitute misleading or deceptive conduct, contrary to section 18 of the Australian Consumer Law and give rise to a false or misleading representation that the applicant or its goods have a sponsorship, approval or affiliation that they do not have, contrary to subsections 29(1)(g) and (h) of the Australian Consumer Law.

27. As I have found that use of the Trade Mark is not, at a minimum, likely to “deceive or confuse” under section 60, it follows that its use would also not, on the stricter test posited by the Australian Consumer Law, mislead or deceive, nor do I believe use would amount to a false or misleading representation in terms of section 29. Thus I find that the opponent has not established the ground of opposition under section 42(b).

    Section 44 – Deceptive similarity

28. Only section 44(1) of the Act is relevant in this case and it is reproduced below:

    (1) Subject to subsections (3) and (4), an application for the registration of a trade mark (applicant's trade mark) in respect of goods (applicant's goods) must be rejected if:

    (a) the applicant's trade mark is substantially identical with, or deceptively similar to:

    (i) a trade mark registered by another person in respect of similar goods or closely related services; or
    (ii) a trade mark whose registration in respect of similar goods or closely related services is being sought by another person; and

    (b) the priority date for the registration of the applicant's trade mark in respect of the applicant's goods is not earlier than the priority date for the registration of the other trade mark in respect of the similar goods or closely related services.

    Note 1:  For deceptively similar see section 10.

    Note 2:  For similar goods see subsection 14(1).
    Note 3:  For priority date see section 12.

29. To establish s 44(1) of the Act the opponent must show all of the following:

    Øa trade mark, either registered or pending registration, in the name of a person other than the applicant, and in relation to which the Trade Mark is either substantially identical or deceptively similar;

    Øthe trade mark in the name of the other person must be in respect of similar goods or closely related services; and

    Øthe priority date of the trade mark of the other person is earlier than the priority date of the Trade Mark.

1. The opponent has specified a number of trade mark registrations which it owns in support of the s 44 ground of opposition. The details of these registrations are as follows:

Number(s)	Class	Trade Mark
1121103	32	UNLEASH THE BEAST!
1398977	5, 30, 32	REHAB THE BEAST!
1557701	5, 32	UNLEASH THE ULTRA BEAST!
1587884	5, 32	PUMP UP THE BEAST!
1653436	5, 30, 32	UNLEASH THE CAFFEINE FREE BEAST!
1668234	5, 32	UNLEASH THE NITRO BEAST!

1. I note that the opponent’s above BEAST tag line trade marks all have earlier priority dates than the Trade Mark. The opponent has stated that they do not believe any of their registrations are substantially identical to the Trade Mark. I agree. Therefore, the key issue to be decided is if the Trade Mark is deceptively similar to any of the opponent’s registered BEAST tag line trade marks.

2. Deceptive similarity is defined by s 10 of the Act. The determination of deceptive similarity requires a comparison of the impression which persons of ordinary intelligence and memory would have upon recalling the opponent’s trade mark, to the impression that they would form from the applicant’s trade mark[15].

   [15] The Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407, Windeyer J [415]

3. According to the authorities[16] any consideration of whether trade marks are deceptively similar must take into account that consumers may have an imperfect recollection of a trade mark. As a general principle one needs to estimate the impression consumers are likely to form of each trade mark as a whole. Confusion may result if a trade mark incorporates the distinguishing features of another’s trade mark. Justice French in Registrar of Trade Marks v Woolworths Ltd[17] observed in relation to the expression “likely to deceive or cause confusion”:

   … The use of the word “likely” in this context does not import a requirement that it be more probable than not that the mark has that effect. The probability of deception or confusion must be finite and non-trivial. There must be a “real tangible danger of its occurring” …

   [16] Clark v Sharp (1898) 15 RPC 141, [146]; Re Application by the Pianotist Co Ltd (1906) 23 RPC 774; Australian Woollen Mills Ltd v F.S. Walton & Co Ltd (1937) 58 CLR 641; Aristoc Ltd v Rysta Ltd (1943) 60 RPC 87; Cordova v Vick Chemical Co (1951) 68 RPC 103; Cooper Engineering Co Pty Ltd v Sigmund Pumps Ltd (1952) 86 CLR 536; Registrar of Trade Marks v Woolworths Ltd (1999) 45 IPR 411

   [17] Woolworths (1999) 45 IPR 411

4. The concepts ‘deceive’ and ‘cause confusion’ were considered in Pioneer Hi-Bred  Corn  Co v Hy-Line Chicks Pty Ltd[18]:

   ‘Deceived’ implies the creation of an incorrect belief or mental impression and ‘causing confusion’ may go no further than perplexing or mixing up the minds of the purchasing public .... Where the deception or confusion alleged is as to the source of the goods, deceived is equivalent to being misled into thinking that the goods bearing the applicant's mark come from some other source and confused to being caused to wonder whether that might not be the case.

   [18] (1979) RPC 410 at 423

5. Thus I need to decide whether the concurrent use of the respective trade marks in relation to the goods in classes 5, 30 and 32 and 33 is likely to result in a tangible danger of confusion or deception. In this case, I do not consider it would.

6. In coming to this decision it is important that the trade marks are considered in their entirety – ‘it is the whole of the mark as used which is the subject of the comparison with the registered mark.’[19]

   [19] Anheuser-Busch Inc v Budejovicky Budvar (2002) 56 IPR 182, 218 (Allsop J).

7. In comparing the respective trade marks it becomes apparent that the Trade Mark shares the word BEAST with the opponent’s BEAST tag line trade marks. The Trade Mark is for the words REAL BEAST. The opponent’s BEAST tag line trade marks are combinations of words followed by an exclamation point which are additional factors that would be likely to be recalled by consumers. Particularly since these additional words are significant and considerably adds to the length and meaning of the BEAST tag line trade marks when viewed or when spoken. Ultimately,:

   One must bear in mind the points of resemblance and the points of dissimilarity, attaching fair weight and importance of all, but remembering that the ultimate solution is to be arrived at, not by adding up and comparing the results of such matters, but by judging the general effect of the respective wholes.[20]

   [20] Clark v Sharp (1898) 15 RPC 141, [146] (Ch D).

8. I am satisfied that the differences between the Trade Mark and the BEAST tag line trade marks are significant and that the additional words in the BEAST tag line trade marks only serves to emphasise the different impressions left by the opponent’s BEAST tag line trade marks and the Trade Mark. I am not satisfied there is a real tangible danger of use of the respective trade marks resulting in confusion in the marketplace.

9. In view of my finding that the Trade Markis not deceptively similar to any of the BEAST tag line trade marks the opponent has not established the ground of opposition based on section 44 of the Act.

   Decision

10. Section 55 of the Act provides:

    55  Decision

    (1)  Unless subsection (3) applies to the proceedings, 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:          Forlimitationssee section 6.

11. The opponent has not established any grounds of opposition. The trade mark application may accordingly proceed to registration one month from the date of this decision. If the Registrar has been served with notice of an appeal before that time, I direct that registration of the Trade Mark shall not occur until the appeal has been decided or discontinued.

    Costs

12. It is usual for costs to follow the event, and I see no reason to depart from that principle here. I award costs against the opponent under section 221 of the Act in terms of Schedule 8 of the Regulations.

    Bianca Irgang

    Hearing Officer

    Oppositions and Hearings

    8 August 2018