Monster Energy Company v Mixi Inc
[2020] FCA 1398
•1 October 2020
Federal Court of Australia
Monster Energy Company v Mixi Inc [2020] FCA 1398
File number: NSD 1959 of 2017 Judgment of: STEWART J Date of judgment: 1 October 2020 Catchwords: TRADE MARKS – extension of protection in Australia to International Registration Designating Australia for the trade mark MONSTER STRIKE in Classes 9 and 41 – opposition relying on ss 42(b) and 60 of the Trade Marks Act 1995 (Cth) (TM Act) – appeal under s 56 against decision of the Registrar of Trade Marks allowing extension of protection – with regard to s 60, whether appellant’s marks including M icon and MONSTER ENERGY had acquired a reputation in Australia – nature and quality of reputation – whether promotion of energy drinks by sponsorship and events in gaming market amounts to reputation in computer games and associated products and services – whether use of opposed mark likely to deceive or cause confusion because of reputation
CONSUMER LAW – s 18 of the Australian Consumer Law (ACL) – misleading or deceptive conduct or conduct likely to mislead or deceive – s 29 of ACL – false or misleading representations – whether use of opposed mark would make representation that products have sponsorship or approval of, or affiliation with, owner of opposing marks – reputation of opposing marks part of the context in which use of opposed mark is assessed – whether use of opposed mark would be contrary to law as being contrary to ss 18 and 29(1)(g) and/or (h) of ACL – whether reliance on s 42(b) of TM Act and ss 18 and 29 of ACL adds anything to reliance on s 60 of TM Act – duplication of case
Legislation: Competition and Consumer Act 2010 (Cth) Sch 2 (‘Australian Consumer Law’) ss 18, 29(1)(g), 29(1)(h)
Trade Marks Act 1995 (Cth) ss 42(b), 56, 60, 197
Trade Marks Regulations 1995 (Cth) regs 17A.3, 17A.28, 17A.34
Explanatory Memorandum, Trade Marks Amendment Bill 2006 (Cth)
Cases cited: Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd [2014] FCA 634; 317 ALR 73
Australian Competition and Consumer Commission v TPG Internet Pty Ltd [2020] FCAFC 130; 381 ALR 507
Australian Competition and Consumer Commission v TPG Internet Pty Ltd [2013] HCA 54; 250 CLR 640
Berlei Hestia Industries Ltd v Bali Co Inc [1973] HCA 43; 129 CLR 353
Butcher v Lachlan Elder Realty Pty Ltd [2004] HCA 60; 218 CLR 592
Cadbury Schweppes Pty Ltd v Darrell Lea Chocolate Shops Pty Ltd [2007] FCAFC 70; 159 FCR 397
Campbell v Backoffice Investments Pty Ltd [2009] HCA 25; 238 CLR 304
Campomar Sociedad, Limitada v Nike International [2000] HCA 12; 202 CLR 45
ConAgra Inc v McCain Foods (Aust) Pty Ltd [1992] FCA 176; 33 FCR 302
Condé Nast Publications Pty Ltd v Taylor [1998] FCA 864; 41 IPR 505
Electrocoin Automatics Ltd v Coinworld Ltd [2004] EWHC 1498 (Ch)
Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58; 185 FCR 9
GAIN Capital UK Ltd v Citigroup Inc (No 4) [2017] FCA 519; 123 IPR 234
Global Sportsman Pty Ltd v Mirror Newspapers Ltd [1984] FCA 167; 2 FCR 82
Google Inc v Australian Competition and Consumer Commission [2013] HCA 1; 249 CLR 435
Hansen Beverage Co v Bickfords (Australia) Pty Ltd [2008] FCAFC 181; 171 FCR 579
Health World Ltd v Shin-Sun Australia Pty Ltd [2005] FCA 5; 64 IPR 495
Hill Industries Ltd v Bitek Pty Ltd [2011] FCA 94; 214 FCR 396
Hugo Boss AG v Jackson International Trading Co Kurt D Bruhl GmbH & Co KG [1999] ATMO 23; 47 IPR 423
Jafferjee v Scarlett [1937] HCA 36; 57 CLR 115
Kraft Foods Group Brands LLC v Bega Cheese Ltd [2020] FCAFC 65; 377 ALR 387
McCormick & Co Inc v McCormick [2000] FCA 1335; 51 IPR 102
Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44; 149 CLR 191
Pham Global Pty Ltd v Insight Clinical Imaging Pty Ltd [2017] FCAFC 83; 251 FCR 379
Polo Textile Industries Pty Ltd v Domestic Textile Corporation Pty Ltd [1993] FCA 265; 42 FCR 227
Qantas Airways Ltd v Edwards [2016] FCA 729; 338 ALR 134
Registrar of Trade Marks v Woolworths Ltd [1999] FCA 1020; 93 FCR 365
Rodney Jane Racing Pty Ltd v Monster Energy Company [2019] FCA 923; 370 ALR 140
Singtel Optus Pty Ltd v Optum Inc [2018] FCA 575; 140 IPR 1
Southern Cross Refrigerating v Toowoomba Foundry Pty Ltd [1954] HCA 82; 91 CLR 592
Telstra Corporation Ltd v Phone Directories Company Australia Pty Ltd [2015] FCAFC 156; 237 FCR 388
Tivo Inc v Vivo International Corporation Pty Ltd [2012] FCA 252
Vivo International Corporation Pty Ltd v Tivo Inc [2012] FCAFC 159; 294 ALR 661
Date of hearing: 8–10 October 2019 Registry: New South Wales Division: General Division National Practice Area: Intellectual Property Sub-area: Trade Marks Number of paragraphs: 183 Counsel for the Appellant: N Murray SC with S Rebikoff Solicitor for the Appellant: Davies Collison Cave Law Counsel for the Respondent: A Fox with E Thompson Solicitor for the Respondent: Watermark Intellectual Property Lawyers ORDERS
NSD 1959 of 2017 BETWEEN: MONSTER ENERGY COMPANY
Appellant
AND: MIXI INC
Respondent
order made by:
STEWART J
DATE OF ORDER:
1 October 2020
THE COURT ORDERS THAT:
1.The appeal against the decision of the delegate of the Registrar of Trade Marks on 18 October 2017 is dismissed.
2.The appellant pay the respondent’s costs.
3.The parties have leave to apply to vary Order 2 by filing and serving, and providing by email to the Associate of Stewart J, written submissions (of no more than three pages) in support of any variation within 14 days of these orders.
4.Until further order, the text of the reasons for judgment published today is to be published and disclosed only to the external lawyers (solicitors and counsel) of the parties who may then disclose the substance of the reasons to their respective clients (the parties) without disclosing any fact or information the disclosure of which would otherwise be in breach of any existing suppression orders in respect of the evidence in the case.
5.Within 14 days of these orders, the parties are to notify the Court by email to the Associate of Stewart J of any parts of the reasons for judgment that they submit should be suppressed, with brief reasons in support of such suppression.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
STEWART J:
INTRODUCTION
[1]
LEGAL PRINCIPLES
[7]
The s 56 appeal
[7]
Section 60 of the TM Act
[12]
Section 42(b) of the TM Act
[23]
THE WITNESSES
[35]
MIXI, ITS MARK AND ITS BUSINESS
[39]
MEC AND ITS AUSTRALIAN MARKS
[50]
Origins of MEC
[50]
MEC’s Australian trade marks
[56]
REPUTATION OF MEC’S AUSTRALIAN MARKS
[58]
INTRODUCTION
[58]
Sales and distribution
[61]
Marketing approach and spend
[68]
Video gaming and eSports
[78]
Gaming website and social media
[83]
Sponsored games and in-game use of marks
[87]
Gaming promotions
[94]
Sponsorship of teams and athletes
[101]
Sponsorship of eSports tournaments
[104]
Sponsorship of gaming content creators
[107]
Hospitality and sampling
[112]
Social media
[116]
Extreme sports
[123]
Event sponsorship
[128]
Music sponsorship
[130]
Apparel and merchandise
[133]
Submissions and conclusions on reputation
[138]
OTHER USE OF MONSTER MARKS AND MONSTERS
[165]
SECTION 60: DISPOSITION
[167]
SECTION 42: DISPOSITION
[178]
Conclusion
[181]
INTRODUCTION
The appellant (MEC) appeals under s 56 of the Trade Marks Act 1995 (Cth) (TM Act) from a decision of a delegate of the Registrar of Trade Marks. The delegate’s decision was to refuse MEC’s opposition to an application by the respondent (Mixi) for extension of protection in Australia to International Registration Designating Australia (IRDA) no. 1242941 for the trade mark MONSTER STRIKE in respect of goods and services in Classes 9 and 41. Those goods and services include electronic games and gaming. Mixi publishes a downloadable video game called Monster Strike.
The grounds on which the extension of protection of an IRDA can be opposed include the grounds on which registration of a trade mark may be opposed in ss 39-44, 58-61 and 62A of the TM Act: Trade Marks Regulations 1995 (Cth) (TM Regulations), reg 17A.34 read with reg 17A.28.
MEC opposes the registration of the MONSTER STRIKE mark on the grounds set out in ss 42(b) and 60 of the TM Act. In respect of s 42(b), which allows for opposition on the ground that use of the mark in respect of which registration is sought would be contrary to law, MEC says that use of the MONSTER STRIKE mark for electronic games and gaming and related goods and services would have been likely to mislead or deceive consumers in contravention of ss 18 and 29(1)(g) and (h) of the Australian Consumer Law (ACL). In respect of s 60, MEC says that due to the reputation of certain of its trade marks in Australia, as at the priority date, the use of the MONSTER STRIKE mark for electronic goods and gaming and related goods and services would have been likely to deceive or cause confusion.
The relevant date at which the grounds of opposition must be established is 27 December 2013, being the priority date for the MONSTER STRIKE mark: TM Regulations, reg 17A.3; Southern Cross Refrigerating v Toowoomba Foundry Pty Ltd [1954] HCA 82; 91 CLR 592 at 595 per Kitto J.
It is common ground in the appeal that MEC’s principal, and almost exclusive, goods that were traded in Australia as at December 2013 using its relevant trade marks were energy drinks. The marks use the word MONSTER usually in conjunction with the word ENERGY and also with device marks, which I will come to shortly. MEC’s traded goods were not computer or video games. However, in order to sell energy drinks MEC had, by that time, undertaken extensive marketing and promotion of its relevant trade marks, including by way of sponsorship, in relation to activities that are of substantial interest to the likely target audience of the designated products and services of Mixi’s MONSTER STRIKE mark, including gaming, eSports, certain genres of music and extreme sports. MEC’s case is that its marketing and promotional activities were such as to give its relevant trade marks a reputation in relation to those activities of substantial common interest, rather than only or principally in relation to its energy drinks.
Thus, the essential question at this introductory stage can be summarised as whether as at December 2013 the use of the MONSTER STRIKE trade mark in relation to electronic games and gaming and related goods and services would have been likely to mislead or deceive consumers with regard to, or to cause consumers to wonder, whether there was any connection in the course of trade between those goods and services and the trader of goods and services that uses MEC’s relevant marks. That connection could be that the trader of each was the same, or that the notional MONSTER STRIKE-branded goods or services had the sponsorship or approval of the trader of the goods that uses MEC’s relevant marks.
LEGAL PRINCIPLES
The s 56 appeal
The appeal is an exercise of the original jurisdiction of the court, which requires the court to determine judicially whether the application for extension of protection should succeed on its merits, not whether the delegate has lawfully discharged their duties. The appeal is a hearing de novo of MEC’s opposition. See Jafferjee v Scarlett [1937] HCA 36; 57 CLR 115 at 126 per Dixon J; Registrar of Trade Marks v Woolworths Ltd [1999] FCA 1020; 93 FCR 365 at [32] per French J, Tamberlin J agreeing.
It is said that the court must approach the matter afresh without undue concern as to the reasons for the decision of the delegate: Woolworths at [32]. In this matter, it would appear from the reasons of the delegate that the evidence before him was quite different to the evidence before me, with the result that there is little reason to have regard to the delegate’s reasons. I obviously intend the delegate no disrespect in adopting that approach.
In an appeal from opposition proceedings, the onus is on the party seeking to oppose the registration of the trade mark to establish the grounds of opposition on which it relies. The standard of proof is the ordinary civil standard of the balance of probabilities. See Telstra Corporation Ltd v Phone Directories Company Australia Pty Ltd [2015] FCAFC 156; 237 FCR 388 at [132]-[133] per Besanko, Jagot and Edelman JJ.
It has also been said that the onus in opposition proceedings lies “squarely” upon the opponent, but I do not understand that adjective to say anything more than that the onus is on the opponent. See Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58; 185 FCR 9 at [32] per Keane CJ, Stone and Jagot JJ.
Section 197 of the TM Act outlines the court’s powers on the appeal. Those powers include: to affirm, reverse or vary the Registrar’s decision or direction; to give any judgment, or make any order, that, in all the circumstances it thinks fit; and to order a party to pay costs to another party.
Section 60 of the TM Act
Section 60 of the TM Act provides as follows:
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.
The purpose of s 60 is to provide protection for well-known marks, whether registered or not, by preventing the registration of a trade mark if there is a likelihood of deception or confusion because of the reputation of the well-known mark in Australia as at the priority date: Explanatory Memorandum, Trade Marks Amendment Bill 2006 (Cth) at [4.10(1)].
Reputation in this context connotes the “recognition of [the mark] by the public generally” and includes the credit, image and values projected by the trade mark: McCormick & Co Inc v McCormick [2000] FCA 1335; 51 IPR 102 at [81] and [85] per Kenny J.
Reputation within the jurisdiction may be proved by a variety of means including advertisements in public media within the jurisdiction. It may be established by showing constant travel of people between other countries and the jurisdiction, and that people within the jurisdiction (whether residents here or persons simply visiting here from other countries) are exposed to the goods of the overseas owner. See ConAgra Inc v McCain Foods (Aust) Pty Ltd [1992] FCA 176; 33 FCR 302 at 343 per Lockhart J, but see also at 348 with regard to limited use of statistics of international travel.
The assessment of the reputation of a trade mark goes far beyond mere examination of sales or turnover of goods sold under the trade mark and contemplation of the advertising and promotional figures. The quantum of sales, advertising and promotions contribute to the “recognition” component of reputation. The credit, image and values projected by a trade mark attach to the “esteem” component of the reputation, as do the public events and other traders’ marks with which the owner of the trade marks in question chooses to associate the trade marks via sponsorships, cross-promotions, and so forth. See Hugo Boss AG v Jackson International Trading Co Kurt D Bruhl GmbH & Co KG [1999] ATMO 23; 47 IPR 423 at 436, adopted in McCormick at [85].
It has long been recognised that brand recognition, and therefore reputation of a trade mark, does not depend on direct advertising. Indirect advertising strategies are adopted precisely because they are effective, and in considering the reputation of a mark indirect advertising must be given proper consideration. See Hansen Beverage Co v Bickfords (Australia) Pty Ltd [2008] FCAFC 181; 171 FCR 579 at [60]-[64] per Finkelstein J; Tivo Inc v Vivo International Corporation Pty Ltd [2012] FCA 252 at [336] and [438] per Dodds-Streeton J; Rodney Jane Racing Pty Ltd v Monster Energy Company [2019] FCA 923; 370 ALR 140 at [84(h)] per O’Bryan J.
The likelihood of deception or confusion from the use of the opposed mark must arise because of the reputation of the other mark. The relevant comparison is between the reputation of the prior mark derived from actual use of that mark, and a notional normal and fair use of the mark sought to be registered in respect of each of the goods or services covered by the specification. See Vivo International Corporation Pty Ltd v Tivo Inc [2012] FCAFC 159; 294 ALR 661 at [113]-[114] per Nicholas J, Dowsett J agreeing.
The use to which the opposed mark has actually been put is of limited relevance. That is because it is the notional normal and fair use of that mark in respect of each of the goods or services covered by the specification that is relevant, and the mark, as in this case, might only have been used in relation to a very limited number of those goods or services. However, evidence as to the way in which the mark has actually been used may be regarded, in the absence of any reason to suppose otherwise, as illustrative of what would be normal and fair: Electrocoin Automatics Ltd v Coinworld Ltd [2004] EWHC 1498 (Ch) at [21].
The objection under s 60 of the TM Act is not based on the requirement that the allegedly conflicting marks are substantially identical or deceptively similar. The question is purely one of prior reputation. Nevertheless, 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. See Qantas Airways Ltd v Edwards [2016] FCA 729; 338 ALR 134 at [142] per Yates J.
The parties place different emphasis on the relevance of the prior mark not having acquired a reputation in respect of the specific goods or services that are the subject of the proposed application. MEC draws attention to McCormick at [85] where statements are made that the volume of a company’s sales does not directly establish that a significant number of people held the relevant marks, as distinct from the company’s products, in favourable regard, and to the statement in Qantas at [143] that the prior mark need not have acquired a reputation that is specific to the goods or services which are the subject of the opposed application. Mixi draws attention to the statements in GAIN Capital UK Ltd v Citigroup Inc (No 4) [2017] FCA 519; 123 IPR 234 at [148] and [169] per Markovic J, citing Hill Industries Ltd v Bitek Pty Ltd [2011] FCA 94; 214 FCR 396 at [208], that where an opponent has a reputation in particular goods or services but that reputation does not encompass the goods or services for which registration is sought, that may be a basis for finding that the ground of opposition is not made out. See also Singtel Optus Pty Ltd v Optum Inc [2018] FCA 575; 140 IPR 1 at [203] per Davies J; Rodney Jane at [87], [116] and [149]-[150].
The tests for deception and confusion hinge on the question of whether or not a reasonable number of people may be caused to wonder if a trade connection exists between the marks: Explanatory Memorandum at [4.10(3)], Southern Cross at 595; McCormick at [82]. A mere possibility of confusion is not enough – there must be a real, tangible danger of it occurring: Southern Cross at 595. Evidence of actual confusion is not required: Berlei Hestia Industries Ltd v Bali Co Inc [1973] HCA 43; 129 CLR 353 at 355 per Barwick CJ.
Section 42(b) of the TM Act
As indicated above, s 42(b) of the TM Act provides that an application for the registration of a trade mark must be rejected if its use would be contrary to law. In advancing this ground of opposition, MEC relies on ss 18 and 29(1)(g) and (h) of the ACL, which is Sch 2 to the Competition and Consumer Act 2010 (Cth). It has long been recognised that a hypothetical future contravention of these provisions is a proper basis for opposition under s 42(b): Health World Ltd v Shin-Sun Australia Pty Ltd [2005] FCA 5; 64 IPR 495 at [44] per Cooper J.
The ACL provisions are relevantly in the following terms:
18Misleading or deceptive conduct
(1)A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.
…
29False or misleading representations about goods or services
(1)A person must not, in trade or commerce, in connection with the supply or possible supply of goods or services or in connection with the promotion by any means of the supply or use of goods or services:
…
(g) make a false or misleading representation that goods or services have sponsorship, approval, performance characteristics, accessories, uses or benefits; or
(h) make a false or misleading representation that the person making the representation has a sponsorship, approval or affiliation; …
Section 18 of the ACL prohibits conduct that is misleading or deceptive or likely to mislead or deceive, whereas s 29 prohibits the making of a false or misleading representation. Conduct that contravenes s 18 may involve, but need not involve, the making of a false or misleading representation: Australian Competition and Consumer Commission v TPG Internet Pty Ltd [2020] FCAFC 130; 381 ALR 507 (TPG FCAFC) at [20] per Wigney, O’Bryan and Jackson JJ; Campbell v Backoffice Investments Pty Ltd [2009] HCA 25; 238 CLR 304 at [102] per Gummow, Hayne, Heydon and Kiefel JJ.
Although s 18 takes a different form to s 29, the prohibitions are similar in nature. Section 18 uses the phrase “misleading or deceptive” whereas s 29 uses the phrase “false or misleading”, but it has been held that there is no material difference between the two expressions: Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd [2014] FCA 634; 317 ALR 73 at [40] per Allsop CJ; TPG FCAFC at [21].
For the inquiry under s 18, it is necessary to identify the impugned conduct and then to consider whether that conduct, considered as a whole and in context, is misleading or deceptive or likely to mislead or deceive: Coles at [38], citing Google Inc v Australian Competition and Consumer Commission [2013] HCA 1; 249 CLR 435 at [89], [102] and [118] and Campomar Sociedad, Limitada v Nike International [2000] HCA 12; 202 CLR 45 at [100]-[101]. In the present case, the impugned conduct is the normal and fair use of the MONSTER STRIKE mark in relation to the goods and services specified in the application. The inquiry then shifts to whether that conduct, considered as a whole and in context, is misleading or deceptive or likely to mislead or deceive.
Conduct is misleading or deceptive or likely to mislead or deceive if it has the tendency to lead into error, i.e. there is a sufficient causal link between the conduct and the likely error on the part of persons exposed to the conduct: Coles at [39], citing Australian Competition and Consumer Commission v TPG Internet Pty Ltd [2013] HCA 54; 250 CLR 640 (TPG HCA) at [39]. Conduct causing confusion and wonderment is not necessarily coextensive with misleading or deceptive conduct: Google at [8] per French CJ, Crennan and Kiefel JJ. Conduct is likely to mislead or deceive if there is a real and not remote chance or possibility that a person is likely to be misled or deceived: Global Sportsman Pty Ltd v Mirror Newspapers Ltd [1984] FCA 167; 2 FCR 82 at 87 per Bowen CJ, Lockhart and Fitzgerald JJ; Butcher v Lachlan Elder Realty Pty Ltd [2004] HCA 60; 218 CLR 592 at [112] per Gleeson CJ, Hayne and Heydon JJ; TPG FCAFC at [22(a)].
It is necessary to view the conduct as a whole and in its proper context. This will or may include consideration of the type of market, the manner in which the goods are sold, and the habits and characteristics of purchasers in such a market: Coles at [41], citing TPG HCA at [52] and Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44; 149 CLR 191 at 199.
Where the impugned conduct is directed to the public generally (or some relevant section of the public), the court must consider the likely characteristics of the persons who comprise the relevant class of persons to whom the conduct is directed and consider the likely effect of the conduct on ordinary or reasonable members of the class, disregarding reactions that might be regarded as extreme or fanciful: Campomar at [101]-[105]; Kraft Foods Group Brands LLC v Bega Cheese Ltd [2020] FCAFC 65; 377 ALR 387 at [236] per Foster, Moshinsky and O’Bryan JJ. In assessing the effect of conduct on a class of persons such as consumers who may range from the gullible to the astute, the court must consider whether the “ordinary” or “reasonable” members of that class would be misled or deceived: Coles at [43], citing Campomar at [105]. See also Google at [7]; Kraft at [236].
The presence or absence of evidence that someone was actually misled or deceived is relevant to an evaluation of all the circumstances relating to the impugned conduct: Coles at [45]. However, it is unnecessary to prove that the conduct in question actually deceived or misled anyone: Google at [6].
There are two relevant differences between the inquiry under s 60 of the TM Act and the inquiry under s 42(b) with reference to the ACL. First, there is no requirement for the purposes of ss 18 and 29 of the ACL to show that the opponent to the registration has a reputation in respect of a specific mark in order to establish that use of the opposed mark would be misleading or deceptive or likely to mislead or deceive. The question is whether the use of the opposed mark in relation to the products for which registration is sought is likely to mislead or deceive persons familiar with the opponent’s product into believing that the two products are associated, having regard to the state of the knowledge of consumers in Australia of the opponent’s product. Any reputation of the prior mark will form part of the context in which the assessment of the likelihood of persons being deceived or misled will be made. See Cadbury Schweppes Pty Ltd v Darrell Lea Chocolate Shops Pty Ltd [2007] FCAFC 70; 159 FCR 397 at [99] per Black CJ, Emmett and Middleton JJ.
Second, unlike under s 60 of the TM Act, ss 18 and 29 contraventions are not established by demonstrating that use of the MONSTER STRIKE mark would be confusing or would cause wonderment: Puxu at 198; Google at [8]. In this sense, opposition under s 60 is less exacting or stringent than opposition under s 42(b) in reliance on ss 18 and 29 of the ACL.
In the light of s 60 being less exacting than s 42(b) in reliance on ss 18 and 29 of the ACL, any proved reputation being part of the context of the ACL assessment and the fact that MEC put no submissions in support of its case under s 42(b) that it did not also put in support of its s 60 case, a real question arises as to why the s 42(b) case was run at all.
THE WITNESSES
MEC called the following witnesses:
(1)Rodney Cyril Sacks, the Chairman and Chief Executive Officer of MEC. Mr Sacks’s evidence addressed, amongst other things, the development of Monster energy drinks and the advertising, marketing and promotion of those products in the United States and elsewhere in the world. He was not required for cross-examination.
(2)Samuel Peter Thiele, the Vice President – Oceania at Monster Energy AU Pty Ltd (Monster AU), a wholly owned subsidiary of MEC. Mr Thiele’s evidence addressed MEC’s sale and distribution of its Monster energy drinks in Australia and MEC’s use of the MEC trade marks in Australia before 27 December 2013, including through various forms of sponsorship. Mr Thiele was cross-examined.
(3)Matthew John Simpson, the Director of eSports at MEC. On medical advice, Mr Simpson was not available for cross-examination. His evidence was, however, mostly confirmed by Mr Pontrelli and Mr Stillwell, who were cross-examined. On that basis, Mixi did not object to Mr Simpson’s affidavit being read notwithstanding that he was not available for cross-examination, provided that his evidence was read and understood in the light of the cross-examination of Mr Pontrelli and Mr Stillwell. Mr Simpson’s evidence addressed MEC’s marketing expenditure in relation to eSports, its sponsorship of eSports teams and competitions, and its profile in gaming.
(4)Michael Christopher Stillwell, the Community Manager – Gaming and eSports at MEC. Mr Stillwell adopted various aspects of Mr Simpson’s evidence. Mr Stillwell was cross-examined by audio visual link from California.
(5)Sam Anthony Pontrelli, the Senior Vice President of Marketing at MEC. Mr Pontrelli adopted various aspects of Mr Simpson’s evidence. He was cross-examined in person.
(6)Thomas J Kelly, the Senior Vice President of Finance at MEC. Mr Kelly’s evidence covered the Monster Group’s United States and worldwide sales figures and expenditure, and, in particular, its Australian sales figures and expenditure. Mr Kelly was not required for cross-examination.
(7)Emily Elizabeth Maartensz, who was, at the time she affirmed her affidavit, a law graduate employed by MEC’s solicitors in the case. Ms Maartensz gave evidence of online searches conducted by her and a number of video games bought and played by her. She was not required for cross-examination.
Mixi called the following witnesses:
(1)Kanji Kobayashi, the Corporate Officer of the Compliance Division, which includes the Legal Department, of Mixi. Mr Kobayashi gave evidence about the use of the MONSTER STRIKE trade mark in relation to Mixi’s video game, and the number of worldwide downloads of that game. Mr Kobayashi was cross-examined by audio visual link from Japan with the use of an interpreter who interpreted between the Japanese and English languages.
(2)Sheona Jane Robertson, who was, at the time she swore her affidavit, a law graduate employed by Mixi’s solicitors. Ms Robertson’s evidence covered various trade mark and internet searches undertaken by her. She was not required for cross-examination.
No issues of credit were raised in respect of any of the witnesses, and none was criticised for their recall. Their evidence can be accepted, taking into account where applicable the ways in which their evidence-in-chief was qualified, corrected, explained or expanded on in cross-examination.
It can be noted that several of MEC’s witnesses, notably Messrs Pontrelli and Thiele and Ms Maartensz, were also witnesses in another case where similar issues arose, namely Rodney Jane. Some of the evidence in that case was put to witnesses in this case, and Mixi urges me to make a number of similar findings of fact to findings that were made in that case. Mixi, however, rightly recognises that the corpus of evidence in the two cases is not the same, the priority dates are different, findings of fact in that case are not admissible to prove facts in this case, and the factual findings in this case can be based only on the admissible evidence that was adduced in this case.
MIXI, ITS MARK AND ITS BUSINESS
As indicated, Mixi seeks registration for the word mark MONSTER STRIKE for long lists of goods and services in Classes 9 and 41. It is not necessary to set out all of the goods and services in respect of which registration is sought, but it is helpful to identify some of them in order to understand the breadth of the application and the possible intersection between the normal lawful use of the MONSTER STRIKE mark, if it is registered, and the use and reputation of MEC’s marks.
Class 9: Downloadable computer game programs; downloadable programs for personal computers; … electronic machines, apparatus and their parts; telecommunication machines and apparatus; straps, covers, earphone jack and other accessories for cellular phones and tablet computers; … downloadable image files; … electronic publications; …
Class 41: Providing non-downloadable video games using communication by an electronic computer terminal, and consultation and providing information thereof; … providing electronic publications about video games; providing electronic publications, and providing information thereof; … providing images, motion pictures, music and audio materials via on-line, and consultation and providing information thereof; … presentation of live show performances; … production of videotape film in the field of education, culture, entertainment or sports [not for movies or television programs and not for advertising or publicity]; organisation, arranging and conducting an event about video games; organisation of entertainment events excluding movies, shows, plays, musical performances, sports, horse races, bicycle races, boat races and auto races.
Mixi is a publicly listed software company with headquarters in Tokyo, Japan. Although its origins date back to 1997, it was not named Mixi until February 2006. Mixi was listed on the Tokyo Stock Exchange in September 2006.
Mixi uses the trade mark MONSTER STRIKE as the name of a downloadable fast-paced action game for mobile devices including iPhones, Android phones and the Nintendo 3DS. The Monster Strike game offers a large number of quests, or levels, for the player to progress through, using various types of monsters to slingshot through the levels to destroy, or strike, enemies. A feature of the game is an online cooperative play mode where up to four players can play together.
The game is free to download and play on smart phones, however, players can purchase extras within the app including “orbs” that are used to obtain special monsters used within the game. The Monster Strike Nintendo 3DS version, which is only available in Japanese, is sold through gaming stores, including online.
The Monster Strike game was launched in October 2013. By 30 June 2014, there had been more than eight million downloads of the game worldwide. By 30 June 2018, there had been more than 44 million downloads of the game worldwide.
An Australian version of the Monster Strike game was launched in June 2015 to test the Australian market. In June 2016, the Australian version was unified into an English language version which was directed to a worldwide English-speaking market. There has been no English language version of the game available for download since August 2017. Only Japanese and Chinese language versions of the game are now available.
Mixi’s business records reveal that it has engaged in merchandising, in-game events, eSports competitions, YouTube promotions and television commercials for the Monster Strike game, including a “Monster Strike Grand Prix” eSports competition held in 2015 and 2016, the latter with prize money of ¥50 million (approximately A$650,000).
The evidence is clear that the Monster Strike game has been extremely popular and successful, particularly overseas. Its success in Australia is not apparent from the evidence. Mixi had an Australian Monster Strike Facebook page until at least June 2016, but by that time when the Australian version of the game was discontinued the page apparently had only 234 “likes/follows” which seems to be a low level of engagement or support.
Mr Kobayashi’s evidence was that he is not aware of any instance of confusion between the Monster Strike game and the products of MEC, or of any person questioning whether the Monster Strike game has been endorsed by or is associated with MEC. MEC’s witnesses were also not aware of any such instance.
The English-language version of the game features this logo:
The Japanese-language version of the game features this logo:
MEC AND ITS AUSTRALIAN MARKS
Origins of MEC
MEC is incorporated in Delaware and has its principal place of business in Corona, California, United States of America. It is a subsidiary of Monster Beverage Corporation (MBC), the shares of which are listed on the NASDAQ stock exchange. I will refer to MBC and its subsidiaries as the Monster Group.
After qualifying and working there as a lawyer for approximately 15 years, including as a partner of a prominent commercial law firm, Mr Sacks emigrated from South Africa to California in 1989. At the end of 1990, a consortium of investors led by him acquired control of MBC, then named Unipac Corporation. In 1992, through a wholly owned subsidiary, Hansen Beverage Company (which later became MEC), MBC acquired Hansen’s natural soda brand and juice business.
In 1996, Mr Sacks decided to test acceptance by consumers in the United States of energy drinks by introducing an energy juice drink as a line extension to Hansen’s Smoothie juice drink line. Consumer response was positive and, as a result, the company determined to develop and introduce an energy drink in the United States. In April 1997, it launched its Hansen’s Energy drink in 8.3 oz (245 ml) cans in Southern California.
Because of difficulties in trying to promote two different types of product under the same brand name to different consumer markets, in April 2002 the company decided to launch a new and separate energy drink in 16 oz (473 ml) cans, which were almost double the size of competitor energy drinks at that time. The name MONSTER ENERGY was adopted for the new product. It was decided to establish a completely separate identity and personality for the MONSTER ENERGY brand.
After 2002, the company expanded its range of energy drinks, which, as at 2013, had been sold to consumers in over 120 countries around the world, including Australia. In January 2012, the company changed its name to Monster Energy Corporation, i.e. MEC.
Monster AU was incorporated in 2008. Its role is to oversee the distribution of Monster energy drinks in Australia, and the marketing and promotion of Monster energy drinks to Australian consumers, including by direct promotion and sponsorship arrangements. It launched the original Monster energy drink in Australia in July 2009.
MEC’s Australian trade marks
MEC has many trade marks that it uses in Australia and elsewhere. All of those in evidence include the word MONSTER. I will refer to them generally as the MONSTER marks. MEC relies on the reputation of ten of its Australian trade marks, some registered and some not registered, in opposing the registration of MONSTER STRIKE. I will refer to them as MEC’s Australian marks. They are the following:
(1)
MONSTER
(2)
MONSTER ENERGY
(3)
(4)
(5)
MONSTER RIPPER
(6)
MONSTER REHAB
(7)
MONSTER GIRL
(8)
MONSTER ARMY
(9)
MONSTER ASSAULT
(10)
MONSTER KHAOS
All of the above marks had one or more registrations before the priority date except for MONSTER RIPPER, MONSTER ARMY, MONSTER ASSAULT and MONSTER KHAOS, which were not registered. I will refer to the stylised M that appears in the device marks (numbered 3 and 4 above) and resembles claws or claw scratches that might be made by an imaginary monster as the M icon or M claw. I will refer to MONSTER in the Gothic-like script with the O crossed through as the stylised MONSTER.
REPUTATION OF MEC’S AUSTRALIAN MARKS
Introduction
The original Monster Energy product, which as I have said was launched in the United States in around April 2002, has always been, and still is, MEC’s most popular and highest-selling product. There have, however, been a number of sublines or variations of the original Monster Energy product over the years. These include Monster Assault, Monster Khaos, Monster Ripper and Monster Rehab.
All of the Monster energy drinks feature one or more of the MONSTER marks on the can (or other container). If not every can design, then just about every one, features the claw mark on the face of the can and then the name of the particular product, MONSTER something, below that. Even when the can is not for the original Monster Energy drink but for one of the many variants, the word ENERGY generally still appears somewhere in close proximity.
MEC’s 2013 Annual Report, which is for the year ended 31 December 2013 (i.e. very close to the priority date), records a number of pertinent facts at that time. These include:
·The Monster Group develops, markets, sells and distributes “alternative” category beverages under a number of different brand names, but its MONSTER ENERGY brand energy drinks represented 91.2%, 92.3% and 92.5% of the Group’s net sales for the years ending 31 December 2011, 2012 and 2013 respectively.
·During 2013, the Monster Group continued to expand its existing product lines and flavours and further develop its distribution markets. In particular, it continued to focus on developing and marketing beverages that fall within the category generally described as the “alternative” beverage category. During 2013, it introduced a number of new products within that category.
·The Monster Group continues to evaluate and, where considered appropriate, introduce additional flavours and types of beverages to complement its existing product lines. The report states that the Monster Group may also evaluate, and where considered appropriate, introduce additional types of consumer products it considers are complementary to its existing products or to which its brand names are able to add value, or both.
·The report explains the Monster Group’s sales and marketing strategy. Its strategy for all its beverages is to focus its efforts on developing brand awareness through image-enhancing programs and product sampling. It uses its branded vehicles and other promotional vehicles at events where it offers samples of its products to consumers. It utilises “push-pull” methods to enhance the shelf and display-space exposure in sales outlets to enhance demand from consumers for its products. It also supports its brands with prize promotions, price promotions, competitions, endorsements from selected public and sports figures, personality endorsements (including from television and other well-known sports personalities), coupons, sampling and sponsorship of selected causes, events, athletes and teams.
·The Monster Group’s net income for the year was US$338,661,000 on gross sales of more than US$2.5 billion.
Sales and distribution
In 2003, MEC started selling its Monster energy drinks outside of the United States. Since that time, it has continued and still continues to expand its international distribution of Monster energy drinks. By the end of 2013, MEC was selling in approximately 114 nations and territories worldwide, including Australia.
MEC launched the original Monster Energy drink in Australia in July 2009. Between then and December 2013, it sold the following products in Australia, all of which featured one or more of MEC’s Australian marks:
·Monster Energy Original (since July 2009);
·Lo-Carb Monster (between July 2009 and July 2014);
·Monster Ripper (between July 2009 and 2013);
·Monster Energy “BFC” (between December 2009 and 2013);
·X-Presso Monster (between July 2010 and 2012);
·Monster Energy Shot (between March 2010 and 2011);
·Monster Energy Import (since September 2010);
·Monster Energy Export (between July 2010 and 2015);
·Monster Energy Extra Strength Nitrous Technology in Super Dry and Anti-Gravity flavours (between February 2011 and March 2014);
·Monster Rehab in orange and lemon flavours (between August 2012 and 2014); and
·Monster Energy Absolute Zero (since March 2013).
Mr Thiele confirmed that the above list is accurate. Notably absent from it are Monster Assault and Monster Khaos. They were apparently not sold in Australia before the priority date.
The cans all featured the M claw, the stylised MONSTER and the word ENERGY, such as in these examples:
Monster Energy Original Monster Energy Lo-Carb Monster Energy Rehab
Financial data prepared by MEC’s finance department at the request of Mr Sacks shows that since the launch of the first Monster Energy product in 2002, MEC has sold more than US$19 billion worth of Monster energy drinks in the United States and more than US$23 billion worth of Monster energy drinks worldwide. That amounts to more than 16 billion cans of Monster energy drinks sold in the United States and more than 22 billion cans of Monster energy drinks sold worldwide.
Monster AU’s gross sales to its distributors in Australia in the years 2011, 2012 and 2013 were US$27.4 million, US$24 million and US$15 million respectively. From 2009 to 2013, more than 78 million cans of Monster energy drinks were sold in Australia, including more than 40 million cans of Monster Energy Original.
In 2013, Monster energy drinks were distributed and sold in Australia in more than 10,000 retail outlets including grocery stores (including national chains Woolworths, Coles and IGA), convenience stores (including 7-Eleven), fuel stations (including BP, Caltex and United), bars and pubs, and at an extensive range of food-service venues such as cafes and takeaway food outlets. In 2013, more than 500,000 cases of Monster energy drinks were sold in Australia, which equates to more than 12 million cans.
Marketing approach and spend
Mr Sacks explained that there are a number of reasons why MEC spends the majority of its advertising, marketing and promotions budget on athlete, gamer and musician endorsement and sponsorship of sporting competitions, eSports competitions and music festivals.
First, the advertising, marketing and promotions that MEC carries out are all about image. MEC’s image needs to be attractive to the target demographic, namely young adults (primarily males) aged between 18 and 34 years. MEC sponsors “edgy”, “aggressive” or extreme events and individuals as these appeal to MEC’s target market by correspondingly making MEC’s products “edgy” and “aggressive”.
Second, mainstream advertising (for example, print and TV media) does not appeal to, and is not designed for, MEC’s target market, which is more likely to dismiss this form of advertising primarily because it has obviously been paid for. Instead, non-traditional forms of advertising such as sponsorships and product placement are more effective in reaching the target demographic, which is likely to think that a MEC-sponsored individual or team, wearing MONSTER-branded apparel or merchandise, is more credible.
Third, by sponsoring athletes, gamers and musicians and related events, MEC receives substantial unsolicited worldwide press coverage, which is more meaningful to MEC’s target demographic.
Fourth, events like those that MEC sponsors, such as extreme sports and eSports, are often broadcast to an international audience (online and on television), which means that it is not only the people attending the events who see MONSTER branding but also viewers who watch the events live or on replay. Mr Sacks said that this type of coverage has also proven to be an effective way of ensuring that MEC’s target demographic is aware of the MONSTER brand even before MEC’s products are launched in that country.
Finally, social media is a large part of the lives of MEC’s target demographic and is international in nature. Content featuring MONSTER-sponsored individuals and teams on its social media sites and on the teams’ and individuals’ own social media sites is very influential and is viewed by millions of people throughout the world.
Mr Thiele confirmed that Monster AU’s approach to marketing and advertising has been the same in Australia. It does not directly pay for any television, radio, print or online advertising of its products. Its entire advertising and marketing budget is directed to sponsorship of athletes, eSports athletes, musicians and events, and in-store marketing and promotions. The goal of this approach is to keep the MONSTER brand “authentic”.
Mr Thiele described four “pillars” to the marketing strategy for what he described as the single MONSTER brand, namely gaming, action sports, music and “girls” (by which I understood him to mean young women). He said that the average consumer of Monster energy drinks in December 2013 was men and women, 15 to 35 years of age, although predominantly men. He said that this was the same demographic as for computer or video games. He described the target demographic as being familiar with the names of various sponsors of eSports events, as not having any difficulty discerning between the different sponsors, as being aware that different sponsors advertise at eSports competitions using different advertising techniques, as being brand savvy and not gullible or foolish.
Between 2002 and 2016, MEC spent more than US$4.39 billion in advertising, marketing and promoting its Monster energy drinks worldwide. Of that, US$2.5 billion was spent between 2002 and 2013. Of those amounts, the majority of it was spent on athlete, gamer and musician endorsements and sponsoring events.
Since July 2009, MEC and Monster AU have spent in excess of US$50 million on marketing and promotional activities in Australia. In the years 2011-2013, they spent US$31.4 million on these activities. Of that, an estimated US$7.15 million was spent on sponsorships of athletes, musicians, competitions and other events.
Video gaming and eSports
Mr Sacks explained that competitive video gaming (eSports) has become increasingly popular, both in the United States and around the world, particularly with MEC’s target demographic. As a result, MEC has established a team dedicated to sponsorship and promotional activities in the areas of gaming and eSports.
Mr Simpson’s evidence was that competitive gaming tournaments have existed since the first video games, such as Space Invaders, were created. The popularity of eSports has exploded in the last decade and eSports is now one of the fastest-growing sports in the world and has significant viewership, particularly among 18 to 25 year old males. For example, tickets for the League of Legends World Championship in October 2013 sold out in hours. More than 10,000 people attended the event at the Staples Center, which is a large sports stadium in Los Angeles.
MEC created the role of Global Head of Gaming and eSports in 2012, a position to which Mr Simpson was appointed. That was as a result of him advocating that MEC should pursue sponsorship opportunities in the gaming market because he saw gaming as a growing market with a demographic that covered a large section of MEC’s target market. Mr Simpson said that when he started in 2012 he had an annual budget of US$600,000, but it has grown exponentially since then. The confidential expenditure report that was tendered shows that the 2013 gaming and eSports expenditure was US$[redacted for three years].
Gaming content is generally shared and accessed online, the only real barrier to accessing content being the language in which it is presented. MEC therefore seeks to sponsor gaming-related content based on language markets rather than national markets.
Mr Simpson identified six different elements to MEC’s strategy as at December 2013 with regard to gaming and eSports, namely: (1) gaming-specific websites and social media; (2) sponsored games and in-game use of the MONSTER marks; (3) gaming promotions, including on-can promotions; (4) sponsorship of eSports teams and athletes; (5) sponsorship of eSports tournaments; and (6) sponsorship of gaming content creators. It is worthwhile considering each in turn.
(1) Gaming website and social media
Between 2012 and 2016, MEC partnered with MEC’s first ever sponsored eSports team, Evil Geniuses, and its owner GoodGame Agency, to produce a gaming-specific website. The website published various gaming-related content and provided tips and tricks from MEC’s sponsored athletes and information on upcoming eSports events. The website was deactivated in 2016 when a dedicated gaming section was created on the Monster Energy website (discussed further below). There was no evidence of how much interest the gaming website generated in Australia before the priority date.
MEC has several social media pages dedicated to gaming. These serve as a way for MEC to promote gaming-specific content, as well as a forum dedicated to gaming through which followers and fans receive up-to-date information regarding MEC-sponsored athletes and teams, interact with each other and discuss gaming and eSports.
MEC has operated a Monster Energy Gaming Facebook page since about July 2010. It had about one million “likes/follows” worldwide by the end of 2013. In the months of June to December 2013, it had approximately 10,000 “likes/follows” from Australia each month.
MEC has also maintained Monster Gaming social media accounts on Twitter since July 2009 and on Instagram since June 2013, both using the @monstergaming handle. There was no evidence of the extent of interest in these accounts in Australia before the priority date.
(2) Sponsored games and in-game use of marks
Since at least 2009, MEC has licensed the use of MONSTER marks in relation to several video games. The video games have included the use of MONSTER marks, references to MEC-sponsored events, and in some circumstances, the likeness of several athletes sponsored by MEC. Use of the MONSTER marks in games often occurs through MEC’s sporting sponsorships. MEC is regularly approached to authorise the use of MONSTER marks in games either by game developers directly, or through MEC-sponsored athletes. The game developers apparently want to use the MONSTER marks to recreate the likeness of a MEC-sponsored event or athlete within the game. In most cases, the games have been promoted on MEC’s social media pages, particularly the Monster Gaming Facebook page.
Mr Thiele and Mr Simpson gave examples of video games that were published in 2013 or earlier in which MONSTER marks are featured such as on billboards, stadium or track boarding, and on the clothing, protective gear or vehicles of players’ avatars just as they would be in real life. From the array of different platforms on which these games are offered, I infer that they have significant appeal amongst the gaming demographic.
Ms Maartensz bought a number of games that were published in or before 2013 and then played them to be able to give evidence of what she saw of MONSTER marks in the games. The game discs were also tendered, but I have not played them myself. Aside from not having available to me the relevant hardware (Xbox 360, Nintendo Wii, PlayStation 3, etc.) to be able to do so, Ms Maartensz’s descriptions of what she saw, and the screenshots that she took, were not challenged. I am therefore content to rely on her evidence.
The games published prior to December 2013 that Ms Maartensz bought and played, and then reported on, with their year of publication are the following: Skate 3 (2010), Colin McRae: DiRT 2 (2009), DiRT Showdown (2012), DiRT 3 (2010), Need for Speed: SHIFT 2 – Unleashed (2011), MUD – FIM Motocross World Championship (2011), Need for Speed: Rivals (2013), MotoGP 08 (2008), MotoGP 13 (2013), WRC: FIA World Rally Championship (2010) and WRC 4 (2013). There were also two others, but there was no evidence of when they were published so I have left them out of account.
Generally, the games depict MONSTER marks in various places and in various ways. In some, the avatars wear MONSTER-branded apparel and protective gear. In some, the player is offered a choice whether to have MONSTER marks on their playing vehicle. In some, MONSTER marks can be seen on the cover of the disc case and on the disc itself. MONSTER marks appear as advertisements on barriers, flags and other structures in the race games. These various observations are confirmed by the screenshots taken by Ms Maartensz.
Ms Maartensz also searched for videos on YouTube, an online video-sharing platform, for videos of eSports competitions involving gamers and teams sponsored by MEC. She found videos of 12 competitions in the period 2010-2013. In each video she observed MONSTER marks on the apparel of players or within the games that were being played, and in some the players were apparently drinking Monster energy drinks. Most of the videos had, by 2018, been viewed tens of thousands of times, but it is not possible to tell how many of those views were before the priority date. I nevertheless accept that MONSTER marks were promoted in the identified ways at these events and that significant numbers of people within the gaming community watched these events, either live or subsequently.
Other than the Monster Energy Supercross game published in 2018 (well after the priority date), there was no evidence of any sponsor of or advertiser in video games themselves publishing an electronic game under their name, or an electronic game being published under their name. Mr Thiele, who had some personal experience as a gamer, could not think of any.
(3) Gaming promotions
Since at least 2009, MEC has partnered with video game publishers annually to promote the release of new video games in the United States. MEC has a long history with Activision, a game publisher, and regularly organises cross-promotions to promote MEC and Activision products, particularly in relation to Call of Duty (COD) games. Cross-promotions create exposure for the MONSTER marks and maintain MEC’s connection with the video game community. The vast majority of these promotions feature “on-can” promotions, meaning that logos and artwork from the particular video game involved in the cross-promotion are featured on Monster energy drink cans.
In 2009, MEC partnered with the publishers of the video game “Call of Duty: Modern Warfare 2” in a cross-promotion that featured the MONSTER marks and the trade marks of the video game. This promotion was “on-can” with logos and artwork from the video game on the cans of Monster Assault, side-by-side with the MONSTER marks. In addition, the cross-promotion featured a competition where consumers could enter to win prizes associated with the video game and MEC. The game “Call of Duty: Modern Warfare” apparently had the largest first week video game release in history at US$550 million. Since the Monster Assault product was not sold in Australia, I infer that this promotion was not conducted in Australia.
In 2010, MEC again partnered with the publishers of the COD series, this time for “Call of Duty: Black Ops” in a cross-promotion that featured the MONSTER marks and the trade marks of the video game. The promotion featured the game’s logo and artwork “on-can” and gave consumers the opportunity to win in-game benefits through purchases of the promotional cans.
In 2013, MEC again partnered with the publishers of the COD series, this time for “Call of Duty: Ghosts” in a large-scale “on-can” co-promotion. The co-promotion was run in over 30 countries. Consumers could win exclusive in-game content by purchasing selected Monster energy products which were co-branded with the CALL OF DUTY: GHOSTS mark.
Also in 2013, MEC ran a co-promotion in respect of the “Aliens: Colonial Marines” game based on the “Alien” movie franchise. Consumers could win a variety of items and they could have their in-game avatar wear armour bearing MONSTER branding.
Also in 2013, MEC ran a co-promotion in respect of the “Far Cry 3” game that involved giving away a variety of items.
There was no evidence of the extent to which the games and promotions referred to above had penetration in Australia.
(4) Sponsorship of teams and athletes
eSports teams are competitive video game teams that compete in multiplayer video game competitions that are played in front of, and streamed to, a live audience, as well as being available for streaming after the events. Video footage was tendered that demonstrates the exuberance and enthusiasm generated for these events amongst the target demographic. The eSports teams and gamers sponsored by MEC under the MONSTER brand include Evil Geniuses (since 2011), who visited Australia in 2012 for the Shadowloo Showdown 6, and Alliance (since 2013). Both teams had had success in major tournaments before the priority date and have substantial international following.
Many of the eSports athletes that MEC sponsors also produce gaming-related content such as tutorials and walk-throughs for games, or they live-stream their gameplay through the gaming platform Twitch. Content created by pro-gamers is very popular. For example, in April 2013 MEC-sponsored athlete, Wickd, who played for Evil Geniuses at the time, broke the record for the largest personal stream of all time on Twitch with 137,769 concurrent peak viewers.
In cross-examination, Mr Thiele accepted that by December 2013 no Australian-based team or Australian-based gamer had been sponsored by MEC, but he explained that some teams such as Evil Geniuses have such success and have support on such a scale that they transcend geographic limits.
(5) Sponsorship of eSports tournaments
In 2013, through MEC’s relationship with GoodGame Agency, the owner of Evil Geniuses and Alliance, MEC sponsored three eSports tournaments, namely Level|Up Series SoCal Regionals, RaidCall DOTA 2 League Season 3 and HyperX D2L. There was no evidence of the size or popularity of these tournaments, or the extent to which they were followed online in Australia.
MEC points to one example of a gaming event that it says was hosted by it. The evidence in that regard is a printout from the Monster Energy Gaming Facebook page on 8 November 2013 which advertises a Call of Duty Ghosts tournament at Stanton, California the next day. MEC’s Facebook post itself states “We’re having a Call of Duty: Ghosts competition…”. From this, MEC submits that it should be concluded that MEC did not only sponsor events, but hosted at least one event and is an active participant in the gaming space.
Even accepting that MEC did actually host, as opposed to merely sponsor, the particular event, which is not the only conclusion that could reasonably be drawn from the language of “we’re having”, there are two reasons why the evidence does not support a conclusion that MEC gained a reputation, even in the United States, of hosting events. First, Mr Simpson himself did not identify organising or hosting gaming events as part of MEC’s strategy in relation to gaming. His evidence was in terms of sponsorship and promotion. Second, evidence of one isolated event is not sufficient to establish a reputation.
(6) Sponsorship of gaming content creators
Gaming content is generally video content about or related to gaming which is uploaded to an online video-sharing platform such as YouTube or Twitch. Twitch is an online video platform which was started in June 2011. It focuses on gaming content including eSports tournaments and community-created gaming content.
Gaming content can be made by game owners or developers to promote their games, and can include announcements, launches and gameplay demo videos. Gaming content is also created by members of the gaming community. The videos might be reviews of games or tutorials for games.
The focus of MEC’s sponsorship activities is directed towards community-created walk-throughs and game-powered entertainment. This type of gaming content generally follows a player’s subjective experience of playing a game, is often accompanied by the gamer’s commentary, and is known in the gaming community as “Let’s Play”. Let’s Play content can be live-streamed and unedited, or it can be edited and uploaded later.
MEC first started sponsoring gaming content creators in 2013. Suitable content creators are identified for sponsorship by looking at their social media presence, viewership numbers, and whether they fit the MONSTER image. Generally the sponsorships involve financial support, providing the content creators with Monster products and apparel, and flying the content creators to events. In exchange, the content creators co-brand their content with MONSTER marks and use the marks on their stream, apparel, and so on.
The only evidence of a content creator sponsored before the priority date is that Alastair Aiken, also known as Ali-A, was sponsored from March 2013. As at 14 July 2013, Ali-A had more than two million subscribers on his main YouTube channel. He promotes the MONSTER brand by wearing apparel featuring MONSTER marks in his videos and at public events and posting about Monster products on his social media pages.
Hospitality and sampling
Since about October 2003, MEC has hired full-time staff to attend events to support and monitor the individuals and teams it sponsors, and to provide hospitality and sampling of products to consumers. MEC’s presence at these events is promoted through distributing free samples, setting up hospitality and sampling areas, and providing MONSTER-branded apparel. The annual expenditure on these activities up to and including 2013 is measured in multiple millions of US dollars per annum.
Mr Thiele explained that since 2009, a significant part of the marketing and promotion strategy in Australia has been dedicated to product sampling. In the years 2011-2013, the expenditure on sampling in Australia, including wages for sampling staff as well as the cost of Monster energy drinks given away as samples, amounted to US$3.4 million.
Evidence was tendered that shows that in the period between March and December 2013, the sampling team in Sydney distributed between 33 and 187 cases of Monster energy drinks each week. The sampling team members wore MONSTER-branded apparel and used MONSTER-branded sampling vehicles to attend various locations to hand out samples. They attended a wide variety of venues such as train stations, stadium car parks, beach car parks, events at pubs, clubs and hotels, national amateur sporting competitions, special events such as the VIVID Festival in Sydney, trade shows, gaming stores, and so on.
The sampling team also attended gaming competitions and conventions to distribute product samples. These included a MaqLAN (Macquarie University Computing Society) 24-hour event in April 2013 and the EB Games Expo in Sydney in October 2013. There was no evidence of other gaming events in Australia prior to December 2013 where MEC was engaged in hospitality and sampling. It is also not apparent how many people attended the two events referred to.
Social media
Separately from its gaming social media, MEC has a website and social media under the name Monster Energy. Naturally, MONSTER marks are prominently displayed on social media and on the website. In the period 1 September 2010 to 1 October 2012, Google Analytics shows that there were 282,861 visits to the Monster Energy website from Australia, which generated 851,763 page views. In the 2013 calendar year, the Monster Energy website received more than 5.1 million visits, of which approximately 66,500 were from Australia. That generated 191,646 page views from Australia. There were almost 50,000 Australian users of the English-language version of the website.
The Monster Energy Facebook page had nearly 24 million “likes/follows” in December 2013, which included more than 400,000 from Australia.
MEC also operates a Monster Energy Girls Facebook page, which as at December 2013 had 245,346 “likes/follows”, including approximately 21,312 from Australia. That Facebook page, contrary to what the name may suggest, is not aimed at girls or young women. Rather, the photographic evidence shows that the Monster Girls are revealingly-clothed young women models used as part of a marketing strategy to sell energy drinks to boys and young men. Mr Sacks described use of the “Monster Girls” at events as being to attract attention and add glamour and entertainment to the events.
The Monster Energy Music Facebook page had 406,144 “likes/follows” as at December 2013, which included approximately 3,456 from Australia.
The Monster Energy Instagram account had 31,756 follows from Australia as at April 2012.
MEC also delivers content through various YouTube channels where it has been posting content since 2009. As at 31 December 2013, the Monster Energy YouTube channel had 3.6 million views from Australia, and about 80 million views worldwide.
MEC’s Monster Energy Australian Twitter account (with the handle @MonsterEnergyAU) had 5,395 follows as at April 2012. No data was in evidence in respect of the period after that.
Extreme sports
As indicated, MEC has also extensively promoted its MONSTER marks internationally by sponsoring professional athletes, sporting events and other newsworthy events, particularly in the extreme sports field. These events then often receive television and internet exposure as they are broadcast, or snippets are broadcast, internationally through news outlets, authorised broadcasters and amateur videos. The sponsorship of athletes involves the MONSTER marks being prominently displayed on clothing and gear worn by the athletes during the sporting events and on sporting equipment used by the athletes.
Just a few of the international athletes who have been sponsored by MEC under the MONSTER brand (i.e. using the MONSTER marks) include world champion F1 driver Jenson Button (in 2009), F1 driver Nico Rosberg (from 2010 to date), world champion F1 driver Michael Schumacher (from 2010 to 2012), world champion Moto GP motorcycle riders Valentino Rossi (from 2009 to date) and Jorge Lorenzo (from 2013 to date), and F1 driver Lewis Hamilton (from 2013 to date).
Australian athletes sponsored by MEC under the MONSTER brand include champion mountain bike rider Sam Hill (from 2003 to date), skateboarder Jake Brown (from 2003 to date), wakeboarder Daniel Watkins (from 2005 to 2013), surfer Claire Bevilacqua (from 2007 to 2010), freestyle motocross rider Blake “Bilko” Williams (from 2008 to date), Supercross/Motocross rider Chad Reed (before 2009 and from 2012 to date), surfers Tyler Wright (from 2009 to date) and Owen Wright (from 2009 to date), and V8 Supercar racing driver Jamie Whincup (from 2009 to 2012).
MEC maintains an amateur sponsorship and athlete development program called the Monster Army. As at 31 December 2013, more than 350,000 amateur athletes in various extreme sports had applied to be part of the Monster Army. Between 2009 and 2013, even if an applicant was not accepted as a sponsored athlete, they were accepted as a “reserve” member, which is an entry-level status. There is a Monster Army Facebook page to support the Monster Army which as at December 2013 had more than 218,000 “likes/follows”, of which approximately 2,900 were from Australia.
MEC also sponsored a number of sporting teams between 2002 and 2013 under the MONSTER brand. These have included a mountain bike racing team and many different motorsport teams including the Monster Energy X-Raid Dakar Rally racing team from 2011. Since 2002, MEC has also sponsored numerous sporting events under the MONSTER brand. These have included a variety of motorsport events, surfing, something known as the Ultimate Fighting Championship, and water sports such as wake boarding and jet ski.
Event sponsorship
Between 2009 and the end of 2013, Monster AU sponsored a number of events in Australia such as the Monster Energy Super X Australasian Supercross Championships and the Aus-X Open, the Monster Energy MX Nationals, V8 Supercars events including the Adelaide 500, various water sports events including the Monster Energy Wake Wars competition (said to be Australia’s premier wakeboard event) and the Monster Energy Freeride Open (a jet ski event). As one would expect, the MONSTER marks and the claw device are prominently displayed on promotional material for the events and at the events. There is generally also apparel on sale or handed out, samples are handed out, the Monster Energy Girls provide some glamour, and so on.
MEC has also sponsored various sports series under the MONSTER brand. These have included the 2008 Monster Energy AMA Supercross Series, a motorcycle racing series involving off-road motorcycles on an artificially made dirt track with steep jumps and obstacles. Although its sponsorship of the Winter and Summer X Games only commenced in 2014, prior to then it sponsored many athletes competing in those events. At the 2013 Winter X Games, MEC-sponsored athletes won 16 medals. The Games were broadcast in 209 countries, including Australia, to approximately 50 million households.
Music sponsorship
MEC has also sponsored musicians and bands, and music festivals which are often attended by thousands of fans and which receive further exposure on the internet, on television and in magazines and newspapers. Sponsorships that commenced in or before 2013 included Jonathan Davis of the band Korn, Dave Lombardo of the band Slayer, the band Atreyu, the guitarist Slash, the band Bullet for My Valentine, the Australian rapper Briggs and the band Of Mice & Men. I understand that the bands and musicians, as this short list shows, are mainly from the metal, hard rock and rap genres – all regarded as “edgy” and fitting with MEC’s target demographic.
MEC sponsored the Soundwave Festival in Australia, an annual music festival held in the Australian state capitals, in 2011 and 2012, and the All Our Friends Festival, a winter festival which was held in Canberra in April 2010.
The Monster Energy Music Facebook page naturally promotes the events and musicians sponsored by MEC, and prominently features MONSTER marks.
Apparel and merchandise
MEC produces and distributes a global point of sale (POS) and apparel catalogue each year. This has been distributed in Australia since 2010. The POS items include various branded display items, stickers, posters, coolers and banners. The apparel and merchandise includes branded caps, beanies, T-shirts, hoodies, singlets, jackets, condoms, and so on. MEC has sold apparel and merchandise bearing one or more of MEC’s Australian marks in Australia since approximately early 2005.
Prior to December 2013, Monster AU ran merchandise giveaways in Australia based on collecting ring-pulls from Monster energy drink cans. At least one of these promotions ran from 1 August to 31 December 2013.
In addition to giveaways, MEC provides each of the individuals it sponsors with MONSTER-branded merchandise. The purpose of this approach in relation to promotional merchandise is to promote the MONSTER brand with the target audience and reinforce the brand image by being associated with events, athletes, gamers, and musicians that MEC’s customers perceive as being “cool” and “legitimate”. Monster AU also conducts in-store promotions and competitions to promote the MONSTER brand in Australia. There was evidence of such a promotion in Coles Express stores in July 2010 and a Monster Energy Kawasaki Team meet and greet at the Picton IGA in New South Wales in July 2012.
Between 2009 and December 2013, MEC’s POS material in Australia included case stackers, display headers, display cards, sell sheets, stickers, posters, countertop coolers, freestanding coolers, “sideshelf” racks or wired racking systems, suction cup racks, shelf talkers, static clings, banners and inflatables.
In the years 2011-2013, Monster AU spent approximately US$1.7 million on POS material in Australia.
Submissions and conclusions on reputation
MEC submits that as at the priority date, MEC’s Australian marks, and in particular the trade marks MONSTER and MONSTER ENERGY, had acquired a very significant reputation amongst consumers in Australia, particularly those in MEC’s target market of young adults (primarily men) aged 18 to 34.
Mixi accepts that, at the priority date, MEC was a large and well-known provider of energy drinks in Australia and that MEC’s device marks (incorporating the M claw, the stylised MONSTER and the word ENERGY) had a reputation in Australia in respect of energy drinks. However, Mixi submits that that reputation did not extend beyond energy drinks or carbonated beverages. In particular, Mixi submits that the evidence does not establish a reputation that extended to the designated goods and services in respect of which Mixi seeks registration for the MONSTER STRIKE mark.
The evidence is clear, and there is no real dispute, that MEC’s M claw in conjunction with the stylised MONSTER and the word ENERGY had a strong reputation in Australia at the priority date. That reputation is particularly strong in the identified demographic, i.e. young men. Moreover, those marks were clearly identified in relation to MEC’s energy drink known as Monster Energy and its many variants. By the end of 2013, very substantial numbers of units of such drinks had been sold in Australia since 2009. Those sales reflected substantial earnings for MEC, which were gained on the back of substantial promotional expenditure in the manner described above.
In cross-examination, Mr Thiele accepted that before December 2013, no Monster energy beverage product had been sold in Australia without displaying the M icon and the stylised MONSTER, and also using the word ENERGY, i.e. all three components. He accepted that it is the M icon and the stylised MONSTER that most makes the brand distinctive and instantly recognisable.
The evidence is clear that if not always, then certainly almost always, on the beverage cans the M icon and the stylised MONSTER appeared one above the other and the word ENERGY in close proximity. Off the cans, which is to say on promotional materials, website pages, social media posts, apparel, promotional vehicles, in video games, on video game packaging, on the vehicles, equipment, gear and apparel of sponsored athletes, and on the Monster Girls’ clothing, the M claw is the most prevalent and distinctive of MEC’s Australian marks. Those features are distinctive and make MEC’s products instantly recognisable. Moreover, where there was also wording it was almost always the words MONSTER ENERGY.
MEC submits that it also had a reputation in the trade mark MONSTER alone. It submits that the evidence shows numerous examples where the word MONSTER was used on its own as a badge of origin for MEC’s products and services.
It was put to Mr Pontrelli that in the Rodney Jane case he had agreed with the proposition that in the photographs exhibited to his affidavit in that case there were no examples of the single word MONSTER being prominently displayed to consumers without either the M icon or the word ENERGY. He said that he had misunderstood the question in that case, and that in fact there were many examples of the word MONSTER being used independently of the M icon and the word ENERGY. He was, however, not able to identify any. MEC’s submissions in this case identify very few such uses in the tendered material.
The clearest example that was identified was in the phrase “MONSTER® packs a powerful punch but has a smooth flavour you can really pound down”. That phrase was printed in small writing on the side of the Monster Energy Original can for Australia and New Zealand in 2009. This photograph demonstrates how the use of the MONSTER mark on its own was dwarfed by the device marks including the words MONSTER ENERGY.
Many other cans of Monster energy drinks had the same or a similar slogan printed on them. In each instance the writing is small and the MONSTER® is dwarfed by the device marks which are distinctive and catch attention. I do not consider this use of MONSTER® to have generated any particular reputation for the use of the word MONSTER on its own.
MEC also refers to some photographs on the Monster Energy Facebook page. One is of a motocross rider, Ryan Villopoto, on his motorcycle in August 2011 with the caption “Monster Continues Winning Streak at Unadilla!”. I understand Unadilla to be a motocross course in New York State. There are a few others apparently taken at the Melbourne F1 Grand Prix in 2012 with the caption “Monster Melbourne Weekender @ The F1 GP”. Finally, there is a photograph in April 2012 of the cover page of Dragster Australia magazine. The photograph shows a racing motor vehicle with the M icon and MONSTER ENERGY marks and a number of people wearing T-shirts with the same marks. It also has the headline “DIVINE INTERVENTION & HARD WORK PAYS OFF WITH MONSTER WIN FOR SHANE TUCKER”. The word MONSTER is in a different colour and is thus given some independent prominence.
In more than 3,000 pages of tendered material, including thousands of pages of photographs and screenshots, there are other examples of the word MONSTER used on its own by MEC. However, as with the examples in the previous paragraph, MONSTER is not used as a brand or trade mark but rather as a shorthand or abbreviated reference to MONSTER ENERGY, which is really the brand that has a strong reputation.
As reflected in MEC’s name and the addresses or handles of several of its social media accounts and its website, and in countless references in the evidence, MEC’s brand is most often referred to as MONSTER ENERGY and not MONSTER on its own. This is also reflected in the Monster Girls regularly being referred to in MEC’s own material as the Monster Energy Girls. The fact that some comments by consumers on MEC’s social media accounts use the word MONSTER as a shorthand term of reference when the accounts themselves are named MONSTER ENERGY and one or other of the device marks appear prominently is not evidence of MONSTER on its own having a reputation of any significance.
MEC also submits that the reputation for the word mark MONSTER derives from its frequent use with other words such as references to Monster products, Monster TV, Monster Media, Monster Lab, Monster Army, Monster Gear, Monster Shout Outs and the Monster Girls on its promotional material, website and social media. But even these uses are almost always in the context of the M claw and stylised MONSTER, and the MONSTER ENERGY word mark.
In the result, the evidence does not support a conclusion that the MONSTER word mark on its own had any particularly significant reputation in Australia at the relevant time. Any reputation of the word MONSTER is derived from the M claw, stylised MONSTER and the MONSTER ENERGY word mark. It is these that create the association in the minds of consumers.
There was no evidence of any reputation in Australia before the priority date of MONSTER ASSAULT and MONSTER KHAOS. The drinks having those names had not been sold in Australia, and none of the Australian-specific promotions seem to have featured them, which stands to reason – there would be no point in promoting them if they were not available for sale. Mr Sacks set out a list of marks which he said were “owned and used by [MEC] in the United States, Australia and many other countries” which he then referred to as “the Monster Marks”, but MONSTER ASSAULT and MONSTER KHAOS do not appear in that list. Mr Thiele also set out a list of MEC’s marks which he said had been used by MEC in Australia. Absent from that list are MONSTER ASSAULT and MONSTER KHAOS.
In the circumstances, to the extent that people in Australia were exposed to those marks as they were used abroad through the internet, social media or international travel, I do not regard that to be significant.
Also absent from Mr Thiele’s list of MEC’s marks used in Australia are MONSTER RIPPER and MONSTER ARMY. Since the Monster Ripper product was sold in Australia, that mark was obviously used here, but there is no evidence to support it having any particular or significant reputation in Australia. The evidence of use of the MONSTER ARMY mark in Australia before the priority date is thin. Essentially it amounts to 2,900 “likes/follows” on the Monster Army Facebook page. No doubt there were people in Australia who accessed content about the Monster Army on the internet, and some may even have joined the Monster Army, but there is insufficient evidence to find any particular or significant reputation of the MONSTER ARMY trade mark in Australia before the priority date.
Although the Monster Rehab product was sold in Australia before the priority date, there is no evidence as to how successful it was and there is little evidence to support it having a particularly significant reputation in Australia. There is evidence to show that it has been a very successful product overseas, from which one might infer that it has also been successful in Australia. But as to its relative success, or what promotion of it there was in Australia, the evidence is silent. In the circumstances, I am not able to find any particular or significant reputation for the MONSTER REHAB trade mark in Australia.
Judging by comments on Facebook and other social media pages that were tendered, the Monster Girls are a popular promotional strategy. There also appear to have been Australian-specific Monster Girls calendars in 2011 and 2012, including a competition in 2011 to choose the most “sexy” Monster Girls for the 2012 calendar. However, once again, the evidence is insufficient to quantitatively establish the reputation of the MONSTER GIRLS trade mark in Australia as at the priority date.
In the circumstances, of MEC’s Australian trade marks – by which I mean the trade marks relied on by it to oppose registration of the MONSTER STRIKE mark under s 60 – it is only the device marks incorporating the M icon, the stylised MONSTER and the words MONSTER ENERGY that had a strong reputation in Australia in December 2013. That reputation was strong, in particular, amongst 18 to 35 year old men and women.
As to the nature of that reputation, it was clearly one linked to energy drinks. Through the promotional strategies which I discussed above, the reputation is also what is referred to as “edgy” and is particularly strong within the target demographic, i.e. amongst men and women who have an interest in gaming, eSports, extreme sports and “edgy” music.
MEC submits that by the priority date, Australian consumers in MEC’s target demographic had a wide awareness of MEC’s Australian marks as emanating from a company with a long-standing and highly active presence in gaming and eSports. It further submits that MEC was strongly engaged with the international gaming community through its dedicated gaming internet sites and social media channels; closely connected with the generation of gaming content creators through its association with eSports athletes, teams and other content creators; and actively involved in the gaming industry through its promotion of, and licensing of its marks to appear in, a number of popular games.
Those submissions can be accepted insofar as they apply only to the M claw and the words MONSTER and ENERGY in association with that mark. It can also be accepted that the marks were well-known in Australia, and that they were associated with a range of gaming and eSports-related products, programs and activities. However, the nature of that association and hence reputation was as a sponsor and supporter. Very often MEC’s marks, showing its sponsorship, appeared alongside many other well-known marks such as Vodafone, Samsung, Toshiba, Blackberry, Alliance and Pirelli, all apparently the names of co-sponsors. Of those with whom the marks had a reputation, there would have been a keen awareness that the trader behind the marks traded in energy drinks and not in other goods or services. MEC sponsored and promoted gaming and eSports events, and for that purpose it published material about such events, but its marks did not, in my assessment, have a reputation as a brand of origin for the provision of gaming event or publishing services; the reputation remained one of sponsor and promoter.
In my assessment, an ordinary consumer would understand the presence of MEC’s Australian marks on athlete uniforms, equipment, event signage, apparel and the like to be for the purpose of advertising and promoting MEC’s energy drinks, and not to be functioning as a brand, or a source of trade origin, for the particular equipment, uniform, signage and apparel upon which the marks appear. This is similar to the findings in Qantas at [174] and [177]. Similarly, MEC’s sampling activities conducted at sports events and other venues, including by the Monster Girls, would be understood by the ordinary consumer to have been conducted for the purposes of advertising and promoting its energy drinks.
I do not accept the submission that, as at December 2013, the marks were closely associated with video games themselves. It is true that the marks appeared in many games, and even on the discs or disc covers, but they did so in the same way that they did in real life, which is to say on representations (drawings, animations and photographs) of gear, apparel, vehicles, banners, cans, etc. As identified above, as at the priority date there was no evidence of any sponsor of or advertiser in video games, such as and including MEC, themselves publishing an electronic game under their name, or an electronic game being published under their name. To the extent that MEC’s Australian marks were associated with video games, once again that was clearly as sponsor or promoter and not as publisher. The evidence does not establish a reputation in Australia in connection with the publishing or sale of video games.
I accept MEC’s submission that in assessing the reputation of the various marks in Australia it is necessary to avoid focusing only on Australian-based activities sales, advertising, promotions, and so on. I accept, as recognised in Pham Global Pty Ltd v Insight Clinical Imaging Pty Ltd [2017] FCAFC 83; 251 FCR 379 at [80]-[81] per Greenwood, Jagot and Beach JJ, citing ConAgra at 342, that the “international mobility of the world population” and the nature of modern media means that goods and services are often preceded by their reputation abroad. They may be well-known even where they are not present and their reputation is “increasingly less limited by national boundaries”. In that context, MEC relies on Australian interest in its international website and social media accounts. It also relies on evidence of very substantial numbers of people visiting Australia from other countries every year, and of people from Australia visiting other countries.
I have taken all of that into account. MEC’s device marks and MONSTER ENERGY mark clearly have a strong international reputation. On the evidence before me, despite there being a plethora of other marks that are used by MEC in relation to its energy drink products, those remain the most distinctive marks. Even accepting a significant spill-over of the reputation of other marks in the United States and elsewhere into Australia, there is insufficient evidence to satisfy me that the other marks have a reputation of any significance in Australia, or that that reputation is other than as a trader of energy drinks.
OTHER USE OF MONSTER MARKS AND MONSTERS
Mixi adduced evidence, through Ms Robertson, of 100 trade marks in Australia in Classes 9 and 41, either registered or pending, that include the word MONSTER. Of those, about 85 are dated before the priority date for the MONSTER STRIKE mark and of them about 40 include being in respect of video or computer games or software. In that regard, I note that Ms Robertson identified 18 of the marks registered in respect of goods or services that include “computer software, video games, or online gaming services”. However, word searches conducted by me indicate that there is at least double that number.
Perhaps surprisingly, there was little evidence in the case that there are video games (other than Monster Strike) that use the word MONSTER in their titles. Evidence was sought to be tendered of a very substantial number of video games with MONSTER in their titles, but it reflected the position as at June 2018 rather than on or before the priority date. For that reason it was rejected. There was some, albeit limited, evidence that monsters, in the sense of frightening imaginary creatures, are common features in video games. Mr Thiele referred to two games, Mortal Kombat and Street Fighter, with such figures, but he said that they were more “humanistic” than monsters. Just what he meant was not explored. He also identified the original Pacman as featuring, in a sense, a monster. Monster Gaming web and social media pages reflect screenshots of MEC-sponsored gamers and teams playing games that appear to involve monster-like characters. On this evidence, I conclude that monsters do feature in other video games, but I am not able to say that they are particularly prevalent or common.
SECTION 60: DISPOSITION
In the light of the evidence and the findings that I have made in relation to the reputation of MEC’s Australian marks, I am not satisfied that there was a real, tangible danger of a reasonable number of people being caused to wonder whether a trade connection exists between those marks and the MONSTER STRIKE mark if lawfully and normally used in respect of the designated goods and services as at the priority date. There are a number of reasons that lead me to that conclusion.
First, the MEC marks in question, being the device marks and the word mark MONSTER ENERGY, had a strong and distinctive reputation that was restricted to energy drinks. Whilst, as I have found, it was strong and distinctive also within the gaming, eSports, extreme sports and “edgy” music spheres, even in those spheres the reputation was of an energy drinks trader and not of a trader in goods or services in those spheres themselves. The designated goods and services in respect of which registration of the opposed mark is sought covers, as dealt with above, a large number of goods and services within Classes 9 and 41. Those are not goods and services to which the reputation of the relevant opposing marks attaches.
That conclusion is not of itself decisive, but it is significant. Because of the quite distinct goods and services, energy drinks on the one hand and a substantial range of computer and technology-related matters on the other including, as MEC emphasises, events and the publishing of information, the risk of confusion is inevitably very much less than it might have been if the goods and services were the same or significantly overlapping.
Second, there are distinctive differences between the relevant marks. Whilst the relevant comparison is between the reputation of the opposing marks, on the one hand, and the notional normal and lawful use of the opposed mark in relation to the designated goods and services on the other, a comparison of the marks themselves is relevant to the inquiry whether there is likely to be confusion. As I have found, the relevant opposing marks are distinctive and almost always include the key elements of the device marks, being the M icon, the stylised MONSTER and the word ENERGY. The plain word MONSTER, albeit part of the marks that have the relevant reputation, does not have a significant or particular reputation in that form. Thus, the relevant opposing marks and the opposed mark are visually and aurally quite different.
MEC submits that the MONSTER STRIKE mark follows the same linguistic structure as other extensions of the MONSTER brand (such as MONSTER RIPPER or MONSTER ARMY), does so using a word (STRIKE) that is consistent with the tenor of MEC’s other brand extensions (ASSAULT, RIPPER and KHAOS), and that it reflects the “edgy” and “aggressive” image of the MONSTER brand. On these bases, MEC submits that there is likely to be confusion in the relevant sense. However, given that I have found that there is no particular reputation for the so-called MONSTER brand as opposed to the device marks and MONSTER ENERGY mark, or for the various so-called extensions of it including RIPPER, ARMY, ASSAULT and KHAOS, those submissions cannot be accepted.
MEC draws attention to the two contrasting judgments of Burchett J in Polo Textile Industries Pty Ltd v Domestic Textile Corporation Pty Ltd [1993] FCA 265; 42 FCR 227 and Condé Nast Publications Pty Ltd v Taylor [1998] FCA 864; 41 IPR 505. In Polo Textile (at 230) it was held that the mark POLO CLUB, used on bedlinen products, was deceptively similar to the mark POLO, used on manchester including sheets and towels, on the basis that many people would attribute distinction to the word POLO rather than to the word CLUB, and that someone who knew of a POLO product, upon seeing a similar product selling under the name POLO CLUB would be quite likely to think it was a particular version of the product which could be described as the CLUB version. In Condé Nast, it was held (at 510) that the word EUROVOGUE, in relation to garments, involves no real or tangible danger of suggesting an association with any magazine such as Vogue Paris and is plainly different from the name of Vogue Australia or the mark VOGUE as used in Australia. It was held that EUROVOGUE, though containing VOGUE as a syllable, does so in a new word with a new meaning and is not like POLO CLUB where the original meaning of Polo is retained and is dominant.
MEC submits that the present case is like Polo Textile in as much as the word MONSTER is dominant and distinctive. However, unlike in that case in respect of the word POLO, in the present case the word MONSTER does not have an established reputation on its own. Also, in that case the competing marks were used in respect of the same kinds of goods, unlike in the present case. In the circumstances, there is little in Polo Textile to support MEC’s case.
Third, there are many other traders (about 40) which at the priority date, had registered or sought to register marks in relation to video and computer games and gaming software that included in their marks the word MONSTER. Although there is no evidence as to how many of those marks were actually used or what reputation they had, by their significant number, as well as the many other registered marks in respect of other goods and services also including the word MONSTER, I infer that there are at least some other marks in the video and computer gaming space that include the word MONSTER and have some reputation in that regard. The conclusion I draw from that is that the opposing marks are not the only marks with a presence in the relevant market that utilise the word MONSTER. That plays a small role in detracting from the confusion that MEC submits will arise from the use of the MONSTER STRIKE mark in that market.
Fourth, the relevant group of potential consumers, being that demographic of young men and women interested in computers, gaming and technology, is generally brand-savvy and not gullible or easily confused. They are not likely on seeing a game or other good or service of the relevant description called MONSTER STRIKE to confuse it with the opposing marks or to be caused to wonder whether the marks are connected. They will understand that the presence of the opposing marks in the relevant market is as a sponsor or promoter in order to enhance the sales of the goods to which those marks actually attach as marks, namely energy drinks.
Fifth, I take into account the fact that there is no evidence of actual confusion between the opposing marks and the MONSTER STRIKE mark as it has been used on about 44 million downloads of the Monster Strike game. Given that the Monster Strike game had a limited life in Australia and therefore its following in Australia is unknown, and the extent of overlap between the use and reputations of MEC’s marks and the MONSTER STRIKE mark in other jurisdictions is unknown, this is a matter of only limited relevance. Nevertheless, it forms a relevant consideration.
In the circumstances, MEC’s ground of opposition in reliance on s 60 of the TM Act must fail.
SECTION 42: DISPOSITION
In the circumstances of this case and for the reasons given at [32]-[33] above, the requirement for successful opposition under s 60 of the TM Act is less exacting than that for opposition under s 42(b) in reliance on ss 18 and 29 of the ACL. The relevant context in which the normal and lawful use of the opposed mark must be considered includes within it the reputation of the opposing marks. Thus, MEC’s reliance on s 42(b) adds nothing to the case.
For the reasons already given in relation to s 60, in my view it is not reasonably likely that the use of the MONSTER STRIKE mark in relation to the designated goods and services at the time of the priority date would have been likely to mislead or deceive the ordinary or reasonable member of the class of prospective purchasers of the designated goods into believing that the MONSTER STRIKE mark and MEC’s marks were related. That includes the various forms of relationship set out in s 29(1)(g) and (h) of the ACL, namely sponsorship, approval or affiliation.
In the circumstances, MEC’s ground of opposition in reliance on s 42(b) of the TM Act must fail.
Conclusion
For the above reasons, MEC’s appeal against the decision of the delegate of the Registrar of Trade Marks falls to be dismissed. I presently see no reason why the costs should not follow the result, however, since I have not heard submissions on costs I will give the parties the opportunity to make submissions in support of a different costs order.
In view of the fact that there are suppression orders in effect in respect of the so-called confidential evidence that was tendered, and these reasons may reveal some of that evidence notwithstanding my efforts to avoid that, I will restrict the publication of these reasons to the parties’ external lawyers for a short period of time to enable them to bring any redactions that might be sought to my attention.
The physical exhibits in the form of a significant number of video games on discs will be retained by the Court pending the possibility of any appeal from this judgment, after which they can be returned to MEC.
I certify that the preceding one hundred and eighty-three (183) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Stewart. Associate:
Dated: 1 October 2020
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