Opposition by Annco, Inc. to registration of trade mark application number 1874506 (class 25) - AEROLOFT - in the name of Nike Innovate C.V.

[2020] ATMO 157

TRADE MARKS ACT 1995

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

Re:Opposition by Annco, Inc. to registration of trade mark application number 1874506 (class 25) - AEROLOFT - in the name of Nike Innovate C.V.

Delegate:	M.Cooper
Representation:	Opponent: King & Wood Mallesons Applicant: Spruson & Ferguson
Decision:	[2020] ATMO 157 Trade Marks Act 1995 (Cth) – opposition under section 52 – ss 44, 59, 60 and 42(b) grounds pressed – no ground established – trade mark to proceed to registration.

Background

1.     This matter concerns an opposition by Annco, Inc (‘the Opponent’), under s.52 of the Trade Marks Act 1995 (‘the Act’), to registration of the trade mark detailed below in the name of Nike Innovate C.V. (‘the Applicant’):

Application Number: 1874506

Trade Mark: AEROLOFT (‘the Trade Mark’)

Filing Date: 20 September 2017

Goods

Class 25:
Footwear; apparel, namely, pants, shorts, shirts, t-shirts, pullovers, sweat shirts, sweat pants, underwear, sports bras, dresses, skirts, sweaters, jackets, coats, socks, sweatbands, gloves, mitts, belts, hosiery, armbands, headbands, coats, vests; headwear, namely, hats, caps, visors, bandanas, hoods, jerseys, sweat bands, scarves; swimwear; cleats for playing soccer, football, baseball, softball, golf, cricket

(‘the Goods’)

2.     The Trade Mark was examined and advertised as accepted for possible registration on 8 February 2018 in the Australian Official Journal of Trade Marks.

3.     On 6 April 2018, the Opponent filed a Notice of Intention to Oppose registration of the Trade Mark. On 3 May 2018, a Statement of Grounds and Particulars (‘SGP’) was filed which cited opposition grounds under sections 44, 59, 60 and 42(b) of the Act. The Applicant filed a Notice of Intention to Defend on 8 June 2018. The parties then filed their evidence as detailed further below.

4.     On 29 April 2019 the Opponent requested a hearing. I heard the matter by videoconference on 3 August 2020 as a delegate of the Registrar of Trade Marks (‘the Registrar’). Khajaque Kortian of Spruson & Ferguson appeared for the Applicant. The Opponent was represented by Bill Ladas of King & Wood Mallesons.

Evidence

5.     Evidence in Support (‘EIS’) was filed by the Opponent on 17 September 2018. It comprised an affidavit of Carole Klinger, lawyer and the Opponent’s Assistant Secretary, dated 13 September 2018 with Exhibits CK-01 to CK-61 (‘Klinger declaration’) and the statutory declaration of Bill Ladas, the Opponent’s legal representative, made on 17 September 2018 (‘first Ladas declaration’) with Exhibits BL-01 to BL-03.

6.     The Applicant’s Evidence in Answer (‘EIA’) was filed on 21 December 2018. It comprised the statutory declarations of Kristen K Downer the Applicant’s Manager, made on 20 December 2018 with Exhibits 1-3 (‘Downer declaration’) and of Khajaque Kortian, the Applicant’s legal representative, made on 21 December 2018, with Exhibit KK-1 (‘Kortian declaration’).

7.     The Opponent’s Evidence in Reply (‘EIR’), filed on 4 March 2019, comprised a further declaration by Bill Ladas, dated 4 March 2019 (‘second Ladas declaration’) with Exhibits BL-01 to BL-03.

8.     The Opponent and Applicant filed written submissions on 20 and 27 July 2020, respectively.

Evidence in Support

9.     The Klinger declaration describes the Opponent as a maker and retailer of women’s apparel and fashion accessories since 1954, initially under the ANN TAYLOR brand. By 1994 she states it had 231 branded stores and had expanded its range to include fragrance, shoes and additional accessories, achieving ‘extensive international fame’. She states that the LOFT brand commenced in 1995 in the combined form of ANN TAYLOR LOFT and then from 2010 as LOFT solus.  LOFT is described as ‘catering for a new and younger crowd’. She lists the Opponent’s net sales (presumably for all its brands) and attaches several thousand pages of exhibits showing the Opponent’s extensive marketing, promotion and advertising in respect of all its brands in a variety of media over several years. Articles mentioning LOFT and LOFT OUTLET stores are also exhibited and the LOFT Facebook page is claimed to have had more than 1 million ‘likes’ between 2010 and 2012.

10.   International shipping is said to have become available from the Opponent’s website in 2013 and it has shipped LOFT branded goods to over 100 countries, including Australia which is said to be the second largest international market for online sales. Klinger claims that the Opponent’s strong US and international reputation in its LOFT brand/s has extended to Australia through various media. In particular she states that between 2012 and 2017 the LOFT website ‘had over six hundred thousand visits from Internet users located in Australia’. She further states that the Opponent distributes email ads to customers, including in Australia and that, between 2012-2017, the Opponent had ‘in excess of ninety thousand customers residing in Australia who have accessed a LOFT email code.’

11. The first Ladas declaration annexes screenshots of the Applicant’s website and those of its retailers showing use of the Trade Mark. This material is said to be directed to the s 59 opposition ground. Various statistics showing figures for travel by Australians to the US for the 2009-2016 calendar years are also exhibited as well as survey results indicating that in 2015 and 2016 92% of surveyed travellers identified ‘shopping’ as the activity in which they participate in the US.

Evidence in Answer

12.   The Downer declaration notes that the Applicant is a subsidiary of NIKE, Inc. She states that in 2013 it commenced using the Trade Mark in Australia and overseas in relation to the Goods. Exhibits are attached showing examples of its use on its website Downer notes that the Goods are also sold around the world in NIKE and third-party retail outlets and department stores. Australian wholesale sales figures for AEROLOFT products from 2013 to 2016 are provided as well as marketing, advertising and promotional material. Downer notes that despite co-existing with Opponent’s LOFT marks for several years, there have been no reported incidents of confusion.

13.   The Kortian declaration exhibits printouts from the Australian Trade Marks Register of those applications and registrations incorporating the word ‘LOFT’ for Goods in Class 25.

Evidence in Reply

14.   The second Ladas declaration provides Wayback Machine extracts indicating that LOFT goods were available for shipping to Australia from February 2013. An extract from the Register showing the status of Australian trade mark application no. 1928017 in the name of Lofty Boards Pty Ltd is exhibited which shows that the Opponent has opposed its registration.

Applicant’s late filed evidence

15.   On 27 July 2020, the Applicant filed its written submissions, attaching new material and seeking that it be admitted under r 21.19 of the Trade Mark Regulations 1995 (Cth) (‘the Regulations’). That material comprised the examiner’s report maintaining a s 44 objection to registration of the Opponent’s trade mark application 1615162 for the word ‘LOFT’ and the Opponent’s response to that report. The Opponent objected to the inclusion of this material. I advised the parties that I would deal with it at the hearing as a preliminary matter. Further written submissions in this regard were provided prior to the hearing.

16.   In summary, the Applicant claimed the material was relevant and of high probative value because it revealed that the Opponent had submitted a contradictory argument in support of its trade mark 1615162, on which it relies in its SGP, to what it put in this opposition. The Opponent essentially submitted that the material was of little probative value as it does not go to proving any factual matter and it is irrelevant as it concerns submissions, not admissions. The Applicant is required to make a compelling case for admission and it has failed to do so.

Consideration

17.   I have had regard to r 21.15(4), which is relevant to a request to introduce material outside the evidentiary stages, and the Trade Marks Office Manual of Practice and Procedure at Part 51, paragraph 2.6 provides in part in this regard:

The delegate will not consider out of time evidence as a matter of routine. The party filing the evidence must make a compelling case in favour of it being considered.

18. Having carefully considered the parties’ submissions, I note the significant amount of time that has elapsed since the closure of the evidence stages. The Applicant has been aware since the SGP was filed of the s 44 and s 60 grounds of opposition and the Opponent’s reliance on its trade mark 1615162 in this regard. There has been no adequate explanation for the Applicant’s delay in filing the material. In the absence of any persuasive submission as to the probative value of the material or the public interest in admitting it, I am not satisfied there is a compelling case in favour of it being considered. On this basis, as I advised at the hearing, I declined to consider Annexures A, B and C and related paragraph 48 of the Applicant’s submissions.

19.   The Applicant also objected to the amended written submissions filed by the Opponent on the day of the hearing. The Applicant was allowed further time and later provided its response.

Grounds of Opposition and Onus

20.   The Opponent bears the onus of establishing one or more of the grounds of opposition and the standard of proof required is on the balance of probabilities.[1]

[1] Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156 affirming the approach of Gyles J in Pfizer Products Inc. v Karam [2006] FCA 1663; (2006) 70 IPR 599 at [6]-[26].

21. As noted above, the Opposition grounds claimed in the SGP are those under sections 42(b), 44, 59 and 60 of the Act.

22.   The time at which a ground of opposition must be established is the date of filing of the application for registration[2]. In this case that date is 20 September 2017 (‘the relevant date’, also referred to as the ‘priority date’ for ss 44 and 60 purposes).

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

Consideration and reasons

23. Section 44 relevantly provides as follows:

44. Identical etc. trade marks

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

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

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

Note 1: For deceptively similar see section 10.
Note 2: For similar goods see subsection 14(1).
Note 3: For priority date see section 12.

….

24.   Relying on trade mark 1615162 for the word ‘LOFT’ (‘the Opponent’s mark’), the Opponent particularised this opposition ground in its SGP as follows:

The Applied-for Goods directly overlap with (e.g. pants, shorts, vests, skirts, sweaters, jackets, coats, socks, gloves, footwear, headwear) or are highly similar to the goods covered by the Opponent’s registration 1615162, and are closely related to the services covered by the Opponent’s registration no. 1615162. The priority date of the Opponent’s registration no. 1615162 pre-dates the Priority Date of the Application.

The Applicant’s AEROLOFT Trade Mark is deceptively similar to the Opponent’s LOFT Trade Mark. There is a tangible danger that a number of persons of ordinary intelligence and memory with an imperfect recollection of the Opponent’s LOFT Trade Mark would be caused to wonder, upon seeing the Applicant’s AEROLOFT Trade Mark, whether it might be the case that the Applied-for Goods come from the Opponent, or are a range of the Opponent’s Goods (specifically, a light-weight or athleisure line). This is because, inter alia:

(a) The word LOFT is inherently distinctive for class 25 goods. The Opponent is accordingly prima facie entitled to a full and generous scope of protection for its mark.

(b) The respective marks are clearly visually similar, in that each includes LOFT, and are aurally similar, because the natural manner of pronunciation of AEROLOFT places emphasis on the latter part of the mark LOFT. The high level of aural similarity is reinforced by the fact that “it is the latter part … that is the more unusual and distinctive”.

(c) The Opponent’s LOFT Trade Mark comprises only the word “LOFT”. It is therefore the essential feature of the Opponent’s LOFT Trade Mark. The Applicant’s AEROLOFT Trade Mark includes the whole of the essential feature of the Opponent’s LOFT Trade Mark.

(d) AERO is a combining word that denotes “air” (it will be seen by consumers as connoting “light weight” in the context of the Applied-for Goods). Combining words are used to form compound words (such as AEROLOFT). In viewing the Applicant’s AEROLOFT Trade Mark, persons of ordinary intelligence and memory would pick out the constituent words AERO and LOFT, and would discount AERO as a descriptive.

25. In order to establish the section 44 ground of opposition under, relevantly, subsection 44(1), the Opponent must demonstrate, subject to subsections (3) and (4), that the Trade Mark issubstantially identicalwith or deceptively similar to the Opponent’s trade mark 1615162; is in respect of similar goods or closely related services (s.44(1)(a)(i)); and has a priority date not earlier than that of the Opponent’s mark (s.44(1)(b)).

26. Section 14(1) of the Act provides that goods are ‘similar’ to other goods if they are the same, or of the same description, as the other goods.

27.   The evidence demonstrates that the latter two elements are satisfied. That is, the Trade Mark’s priority date (20 September 2017) is later than that of the Opponent’s mark (18 September 2013) and the registration application relevantly designates many same or similar goods in Class 25.

Substantially identical

28.   Neither party submitted that there was substantial identity between the marks. Having conducted a side by side comparison, that is between AEROLOFT and LOFT,  I am not satisfied that a total impression of resemblance emerges between the Trade Mark and the Opponent’s mark such that they might relevantly be regarded as being substantially identical.[3]

[3] Shell Co. of Australia v Esso Standard Oil (Aust.) Ltd. (1963) 109 CLR 407, 415.

Deceptive similarity

29. Section 10 of the Act defines deceptive similarity as follows:

Section 10 - Definition of deceptively similar
For the purposes of this Act, a trade mark is taken to be deceptively similar to another trade mark if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion.

30.   A determination of ‘deceptive similarity’requires an assessment of the likelihood of deception or confusion arising from a recollection or impression of the respective marks by potential consumers of the goods and/or services[4]. This is to be assessed by reference to the standards of ordinary people ‘who should not be credited with high perception or habitual caution’ and in the context of the business and the way in which the particular class/es of goods are sold or services provided.[5] A possibility of confusion is not sufficient; there must be a real tangible danger of confusion.[6] A likelihood of confusion will exists if there “is a real likelihood that some people will wonder or be left in doubt about whether the two sets [of goods] come from the same source.”[7] The use to be considered is notional use[8].

[4] Shell Co. of Australia v Esso Standard Oil (Aust.) Ltd. (1963) 109 CLR 407, 416.

[5] Australian Woollen Mills v F S Walton and Co Ltd (1937) 58 CLR 641, 658.

[6] Australian Woollen Mills v F S Walton and Co Ltd (1937) 58 CLR 641; Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 529, 594-5; Registrar of Trade Marks v Woolworths Ltd [1999] FCA 1020 [44].

[7] Registrar of Trade Marks v Woolworths Ltd (1999) 93 FCR 365 [50(ii)].

[8] Berlei Hestia Industries Ltd v Bali Co Inc (1973) 129 CLR 353, 362.

31.   The Goods cover various types of clothing and footwear and coincide with many of the class 25 goods covered by the Opponent’s mark.  Notionally, assuming Trade Mark use in a normal and fair manner across all of the Goods, the Applicant will be selling products bearing the Trade Mark, in part at least, to the same types of Australian consumers and in the same markets as the Opponent.

32.   In estimating the effect or impression produced on the mind of these potential customers, I note the comment in Clarke v Sharp in relation to the appropriate comparison in the circumstances:

One must bear in mind the points of resemblance and the points of dissimilarity, attaching fair weight and importance to all, but remembering that the ultimate solution is to be arrived at, not by adding up and comparing results of such matters, but by judging the effect of the respective wholes.[9]

[9] Clark v Sharp (1898) 15 RPC 141, 146.

33.   The visual and aural effects of the marks are different. The Trade Mark comprises three syllables while the Opponent’s mark contains only one. Notwithstanding the common element ‘LOFT’, there is no basis on which to accept the Opponent’s contention that the word “aero” increases the emphasis on “loft”. Rather, it is the first element that is generally be given the most weight when comparing marks.[10] As Finn J said in revisiting the tests for deceptive similarity in C A Henschke & Co v Rosemount Estates Pty Ltd:

[P]articular attention ought be paid to the first part of a name for generally the first word or syllable provides the most important means of distinguishing marks... save where the initial word or syllable is both common to the marks and is common to the trade or is commonly used by a number of trade mark proprietors, in which case the emphasis is to fall on other portions of the mark as a means of distinguishing them.[11]

[10] London Lubricants (1920) Ltd's Appn, (1925) 42 RPC 264.

[11] C A Henschke & Co v Rosemount Estates Pty Ltd. [1999] FCA 1561 [35].

34.   The first part of the Trade Mark, ‘AERO’, is not common to the marks nor is there any evidence it is common to the trade or commonly used by several proprietors. Therefore ‘AERO’ is to be attributed more weight in comparing the trade marks. Considered in combination with the visual and aural differences, there is little likelihood of any confusion arising from an imperfect recollection of the Opponent’s mark. Furthermore, having regard to ‘the idea which the mark will naturally suggest to the mind of one who sees it’[12], there is no obvious or evidenced ‘idea’ conveyed by the respective marks in the context of the Goods..

[12] Jafferjee v Scarlett (1937) 57 CLR 115, 121.

35.   I have also had regard to the Opponent’s submissions that the Opponent’s mark is “wholly contained” in the Trade Mark and that deceptive similarity arises not because the two marks are likely to be mistaken for one another, but because a consumer, on encountering the Trade Mark, ‘would be caused to wonder whether the goods stem from the same or a related commercial source, e.g. this is an aerodynamic or “aero” LOFT branded garment’. That is, there would be ‘contextual confusion’. As observed by the Applicant, there is no evidence (or submission in relation to this ground) that the Opponent is recognised as having a ‘family’ of marks in Australia that would suggest to consumers seeing the Trade Mark that it denoted the same trade origin.

36.   In addition, in relation to contextual confusion, Burchett J’s comments in Conde Nast Publications Pty Ltd v Virginia Taylor (‘Conde Nast’) are apposite:

"EUROVOGUE", though containing "VOGUE" as a syllable, does so in a new word with a new meaning. It is not like "Polo Club", where the original meaning of "Polo" is retained and is dominant, so that a product labelled with the two words may be taken as merely the "club" version of the Polo product. Cf Polo Textile Industries Pty Limited v Domestic Textile Corporation Pty Limited [1993] FCA 203; (1993) 42 FCR 227 at 230. "VOGUE" is altogether too indefinite a word, in this context, to have that sort of distinctive impact. Its meaning is particularly vague when it is combined with "Euro", since a pan-European vogue would be very hard to envisage. [13]

[13] [1998] FCA 864.

37.   Similarly, AEROLOFT, although it contains ‘LOFT’ as a syllable, it does so in a new, invented word with a different meaning, reducing the emphasis on the word LOFT. The ‘LOFT’ element is ‘too indefinite a word’ in the context of the Goods to be retained or considered as dominant. In addition, the submission that ‘“aero” is descriptive and a covetable characteristic of class 25 goods’ or that consumers would regard the Trade Mark as an ‘aero’ version of ‘loft’, or, as the Opponent contended ‘an aerodynamic or ‘aero’ LOFT branded garment’ is purely speculative, unsupported by any evidence, and I therefore give it little weight. In particular, the risk of confusion is mitigated when one of the words (such as AEROLOFT) has no readily apparent meaning.[14]

[14] Gardenia Overseas Pty Ltd v The Garden Co Ltd [1994] FCA 1280 [49].

38.   As Burchett J also found in Conde Nast in respect of clothing, ‘the goods sold under the trade mark are goods likely to be subjected to a careful visual examination by any intending purchaser, or even by any person whose interest in them is at all aroused. The appearance of ladies’ clothing and men's casual wear is very important.’[15] Such consumer care and scrutiny in purchasing the Goods militates against the likelihood that a consumer would be caused to wonder or infer that those Goods sold under the Trade Mark are those of the Opponent or associated with it. This is reinforced by the absence of any evidence of confusion despite both marks operating in the Australian market since 2013/14.   

[15] Conde Nast, n13.

39.   For the above reasons, notwithstanding the common suffix, “LOFT”, I am not satisfied that the Trade Mark ‘so nearly’ resembles the Opponent’s mark in any material way such that it would be ‘likely to deceive or cause confusion’ among ‘persons of ordinary intelligence and memory’, even allowing for imperfect recollection.

40. It follows that the Opponent has failed to establish the s 44 ground of opposition.

Section 60

41. Section 60 provides as follows:

Trade mark similar to trade mark that has acquired a reputation in Australia

The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:

(a)  another trade mark had, before the priority date for the registration of the first        -mentioned trade mark in respect of those goods or services, acquired a reputation in Australia; and

(b)  because of the reputation of that other trade mark, the use of the first-mentioned trade mark would be likely to deceive or cause confusion.

42. Therefore, to establish the s.60 ground of opposition, an opponent must demonstrate that, at the relevant date, there was another trade mark that had acquired a reputation in Australia and because of that reputation, use of the trade mark sought to be registered would be likely to deceive or cause confusion.

43.   The SGP particularised this ground as follows:

The Opponent has invested heavily in promoting its Goods and Services by reference to the LOFT Trade Mark and has achieved considerable commercial success in Australia before, leading up to and beyond the Priority Date.

By virtue of its use and promotion of the Opponent’s Goods and Services under and by reference to the LOFT Trade Mark: (a) the Opponent has, and had acquired before the Priority Date, a reputation in Australia in respect of its clothing and related goods and retail services; and (b) the Opponent’s LOFT Trade Mark is, and was before the Priority Date, well and favourably known among members of the public throughout Australia as indicating the Opponent exclusively as the source of the Opponent’s Goods and Services (which encompass the Applied-for Goods).

In light of the Opponent’s reputation identified above, and the similarity between the respective marks and the overlapping or highly similar goods as set out above in respect of section 44, the Opponent submits that any use of the Applicant’s AEROLOFT Trade Mark in respect of the Applied-for Goods would be likely to deceive or cause confusion.

44.   The Opponent submitted that the Opponent’s mark has ‘a reputation in another country which can be shown to have extended to Australia.’  The Applicant contended that the Opponent had not demonstrated the relevant reputation in its ‘LOFT’ trade mark, having conflated its use with its other trade marks and noting its significant co-branding with ANN or ANN TAYLOR.

Reputation

45.   Kenny J’s remarks in McCormick & Co Inc v McCormick in relation to s.60 and the measurement of reputation are relevant in this respect:

In practice, it is commonplace to infer reputation from a high volume of sales, together with substantial advertising expenditures and other promotions, without any direct evidence of consumer appreciation of the mark, as opposed to the product: see, e.g., Isuzu-General Motors Australia Ltd v Jackeroo World Pty Ltd (1999) 47 IPR 198; Marks & Spencer plc v Effem Foods Pty Ltd (2000) AIPC 91-560; Photo Disc Inc v Gibson (1998) 42 IPR 473; and RS Components Ltd v Holophane Corp (1999) 46 IPR 451. This Court has followed this approach as well, acknowledging that public awareness of and regard for a mark tends to correlate with appreciation of the products with which that mark is associated, as evidenced by sales volume, amongst other things. [16]

[16] [2000] FCA 1335 [86].

46.   In addition, the reputation required to be demonstrated must be one of which a significant number of people in the relevant market in Australia would be aware.[17]

[17] Renaud Cointreau v Cordon Bleu International Ltd [2001] FCA 1170 [75].

47.   Despite almost 4000 pages of exhibits to the Klinger declaration, there was little that demonstrated the reputation of the Opponent’s mark in Australia. I note that:

·     there is evidence of significant advertising/marketing activity, the preponderance of which demonstrates use of ANN TAYLOR.

·     The sales revenue figures reflect figures for the entire company and the amount referable to the Opponent’s mark or Australian sales is not identified.

·     Several articles constitute financial commentary on the ANN TAYLOR company as a whole, not specifically the LOFT brand. In any event, they do not demonstrate use of LOFT as a trade mark.

·     The Women’s Wear Daily rankings from 2001 to 2014 rank the ANN TAYLOR brand, not LOFT[18];

·     The several types of media monitoring demonstrating the use of LOFT is frequently local ( the Miami Herald, the NY daily News, The Buffalo News’ ‘The Morning Blend’ etc.) and, in the absence of any evidence otherwise, seem unlikely to ‘spillover’ to Australia.

·     The fact that a handful of female celebrities are seen wearing LOFT clothing in overseas magazines (more are shown wearing ANN TAYLOR) is not persuasive in demonstrating a spillover reputation in Australia.

·     While LOFT is advertised and promoted in some overseas fashion magazines that do also circulate in Australia, such as Marie Clare and O Magazine, Australian circulation figures are not provided and the use demonstrated is not of such frequency or prominence that I am satisfied a significant number of relevant Australian consumers would be aware of it.

·     Various collaborations undertaken by the Opponent using the Opponent’s mark do not indicate or even suggest any Australian connection or enable an inference of spillover.

·     Similarly, the figures provided of Australian travel to the US are very general in nature and the survey evidence is not specific to as to the nationality of those surveyed. I also note the comments of Lockhart J in ConAgra who described Australia-US travel statistics as “a rather flimsy twig” on which to support evidence of spill-over reputation in Australia[19].

·     The mention of ‘LOFT’ in one episode of a TV show and of ‘ANN TAYLOR LOFT’ in another which is also shown in Australia is insufficient to establish the brand’s reputation in Australia[20].

[18] Although in 2004 it references LOFT as Ann Taylor’s ‘sister’ brand.

[19] Re ConAgra Inc v McCain Foods (Aust) Pty Ltd (1992) FCR 302, [1992] FCA 159 [139] (‘ConAgra’).

[20] Contrast Dodds-Streeton J’s comments in TiVo Inc v Vivo International Corporation Pty Ltd [2012] FCA 252 [371]-[389] (‘Tivo’).

48.   In relation to Australia, Exhibit 6 of the Klinger declaration shows an undated screenshot of the ‘international’ section of the website loft.com indicating that LOFT products are shipped to over 100 countries, of which Australia is one[21]. Exhibit 8 comprises nine receipts which show that ‘LOFT’ apparel was sent to Australia in 2017, (another six receipts post-date the relevant date). Klinger does not assert that these receipts are selective or merely a sample of the Australian sales made. Such a low number of sales seems inconsistent with Klinger’s statements that the LOFT website has had over 600,000 visits from internet users located in Australia between 2012 and 2017 and, in the same period, had 90,000 Australian residents who had ‘accessed a LOFT email code’. As noted by the Applicant, these figures are not supported in any way in the evidence. Even if I accept their accuracy, the low number of evidenced sales suggests the Opponent’s mark does not have the Australian market penetration or awareness that the internet/email figures might otherwise suggest. Accordingly, I given them little weight as evidencing the reputation of the Opponent’s mark in Australia.

[21] Wayback machine screenshots exhibited in the second Ladas declaration indicate February 2013.

49.   I have also had regard to the Opponent’s reliance on Dodds-Streeton J’s acknowledgment in Tivo that ‘even in the absence of sales or use, a mark may acquire a reputation in Australia …  because the mark has a reputation in another country which can be shown to have extended to Australia.’[22] The Full Federal Court, in upholding this decision, noted however that TiVo’s reputation was established on the basis of evidence of ‘the publication of 630 articles in the Australian media, five major films screened in Australia (three of which were broadcast on television), 19 episodes of television programs broadcast in Australia and 42,100 web pages published on Australian websites all of which contained referenced to TiVo.’[23] Nothing approaching this level of Australian exposure is evidenced in the Opponent’s material.

[22] Tivo, n21, [336].

[23] Vivo International Corporation Pty Ltd v Tivo Inc [2012] FCAFC 159 [59].

50.   While I accept that the evidence might substantiate a ‘saturation level’[24] of coverage for its ANN TAYLOR brand in the United States such that it might be regarded as having an acquired an Australian reputation, it falls short of enabling an inference that the Opponent’s mark was one of which a significant number of consumers in the Australian market were aware at the relevant date.

[24] Next Retail Limited v Gordon Simpson Agencies Pty Ltd [2011] ATMO 128 [22]-[25].

51. It follows that I am not satisfied that at the relevant date the Opponent’s mark had acquired a reputation sufficient to enliven s 60(a).

52.   Even if I am wrong in this regard, as noted above, the Opponent is required to establish that, because of its reputation in its LOFT trade mark, notional use of the Trade Mark on the Goods would be likely to deceive or cause confusion among relevant Australian consumers. As Yates J said in Qantas v Edwards (Qantas), ‘for the purposes of s 60 ...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.’ [25] For reasons discussed above, I am not satisfied that the degree of similarity between the marks is such that it is likely to cause deception or confusion.

[25] Qantas Airways Limited v Edwards [2016] FCA 729 [142]-[143].

53.   In addition, as also discussed above, in relation to clothing purchases, consumers tend to take care and time to assess the product before they purchase.[26] Such awareness and attention by consumers further reduces any likelihood that because of the reputation of the Opponent’s mark, use of the Trade Mark would be likely to lead to deception or confusion.  

[26] See also Autumnpaper Ltd v Maya McQueen Pty Ltd [2016] ATMO 53; Hugo Boss AG v Tagmill Pty Ltd [2000] ATMO 23, Taiwan Yamani v Giorgio Armani 17 IPR 92.

54.   It follows that I am not satisfied there is a likelihood that, because of the reputation of the Opponent’s mark, use of the Trade Mark would be likely to deceive or cause confusion among relevant Australian consumers.

55. Therefore, the s 60 ground has not been established.

Section 42

56. Section 42 of the Act provides:

Trade mark scandalous or its use contrary to law

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

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

(b)  its use would be contrary to law.

57. In relation to s 42(b), referring to the same matters as relied on in its s 60 ground, the Opponent’s SGP provides as follows:

The Opponent reiterates the facts set out above in respect of section 60. In summary, the Opponent has extensively used and promoted its LOFT Trade Mark Marks in respect of the Opponent’s Goods and Services since as early as 2013 in Australia, and continuing up until and beyond the Priority Date.

As a result of among other things these activities, the Opponent has built up a valuable goodwill and reputation associated with the LOFT Trade Mark in relation to its Goods and Services in Australia, now and as at the Priority Date.

As such, the LOFT Trade Mark is exclusively and distinctively associated with the Opponent and its Goods and Services, such that use of the Applicant’s AEROLOFT Trade Mark in Australia in relation to the Applied-for Goods would be likely to cause confusion as, amongst other things, it would wrongly suggest a connection in trade between the Applicant and the Opponent, or that the Applicant’s goods are provided by or with the sponsorship or approval of the Opponent.

Use of the Applicant’s AEROLOFT Trade Mark in respect of the Applied-for Goods would therefore constitute misleading and deceptive conduct and the making of false statements contrary to sections 18 and/or 29 of the Australian Consumer Law, respectively, and passing off at common law.

58.   The onus is on the Opponent to establish on the balance of probabilities that use of the Trade Mark would be, rather than could be, contrary to law.[27]

[27] Primary Health Care Limited v Commonwealth of Australia [2017] FCAFC 174 [411].

59. Section 18 of the Australian Consumer Law (‘ACL’) (formerly s 52 of the Trade Practices Act 1974 (Cth)) concerns consideration as to whether the relevant consumers would be misled or deceived as to the true origin of the Applicants’ Goods or that they had some connection with the Opponent. The Court noted in Puxu that ‘conduct which merely causes some uncertainty in the minds of relevant members of the public does not breach s 52.’[28] I note my findings above that use of the Trade Mark would not cause a person to be confused or deceived as to the source of the Goods. It follows that I am not satisfied, in the absence of any further persuasive evidence in this regard, that the Opponent has discharged the onus on it to establish that use of the Trade Mark would be likely to mislead or deceive within the meaning of s 18 of the ACL. In relation to s 29, I note that there is no evidence before me that the Applicant has directly represented that its goods or services have sponsorship, approval, performance characteristics, accessories, uses or benefits they do not have. It follows that I am not satisfied that the Opponent has established that use of the Trade Mark would be contrary to law in the sense that it has contravened ss 18 or 29 of the ACL.

[28] Custom Built Furniture Pty Ltd vPuxu Pty Ltd (1982) 149 CLR 191, 198.

60.   Regarding the claims of passing off, as Hill J found in Re Equity Access Pty Ltd v Westpac Banking Corporation [29] where use of a trade mark does not contravene s 18 of the ACL, neither will it amount topassing off. Even if it is accepted that the Opponent’s mark has the relevant reputation, there is no persuasive evidence before me that indicates or even suggests a relevant misrepresentation by the Applicant or damage to the Opponent. Therefore, the Opponent has not established that use of the Trade Mark would be likely to be contrary to law in the sense that it constitutes passing off.

[29] Re Equity Access Pty Ltd v Westpac Banking Corporation [1989] FCA 506 [39].

61. For these reasons I am not satisfied that the s 42(b) ground has been established.

Section 59

62. Section 59 of the Act provides as follows:

Applicant not intending to use trade mark

The registration of a trade mark may be opposed on the ground that the applicant does not intend:

(a) to use, or authorise the use of, the trade mark in Australia; or

(b) to assign the trade mark to a body corporate for use by the body corporate in Australia;

in relation to the goods and/or services specified in the application.

63.   The SGP particularises this ground as follows:

As at the Priority Date, based on desk research, the Applicant was not using the AEROLOFT Trade Mark in respect of any or all of the Applied-for Goods in Australia, and neither did it hold a sufficiently definite intention to use the AEROLOFT Trade Mark for some or all of the Applied-for Goods. Rather, as at the Priority Date, it was apparent that the Applicant’s intention was:

(a) to use the composite mark NIKE AEROLOFT; and/or

(b) in respect of use on or in relation to goods in class 24 that are not the subject of the Application; and/or

(c) in respect of use on or in relation to a limited set of goods within the full range of the Applied-for Goods.

64.   The making of a trade mark application is a prima facie indication of intention to use that trade mark[30] and, as the Full Court noted in Food Channel, ‘only a low threshold has been set with regard to intention to use.’[31] The intention is to be assessed at the date of the application[32]. Events occurring after the date of application might be used to raise an inference about the Applicant’s intention at the application date[33]. Where the opponent establishes a prima facie case of lack of intention to use the evidentiary onus shifts to the applicant.[34]

[30] Aston v Harlee Manufacturing Company [1960] HCA 47; (1960) 103 CLR 391

[31]Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58 [67]

[32] Ibid.

[33] Suyen Corporation v Americana International Limited [2010] FCA 638 [211] (‘Suyen’).

[34] Suyen [190].

65.   Examples of cases where lack of intention to use has been established are discussed in Suyen:

Because the intention concerns the applicant’s state of mind, it is, as the authorities make clear, difficult for an opponent to discharge the onus it bears under s 59of the Act. Opposition has nevertheless succeeded in a number of cases. The intention has been held to be contra-indicated where the applicant company was not operating and failed to provide evidence, had no capacity to trade in the relevant goods or services or was subject to a relevant contractual restraint… In other cases, opposition has succeeded because the evidence established the existence of only illegitimate purposes, including the use of registration defensively, speculatively, to gain competitive advantage or to sell the trade mark..[35]

[35] Suyen [212]-[221].

66.   There is no evidence of any conduct by the Applicant of this nature. Examining the evidence as a whole, it shows use of the Trade Mark by the Applicant’s parent company Nike Inc both before and after the relevant date. The Opponent contended this demonstrated the Applicant’s lack of intention to use it. The Applicant acknowledged Nike Inc’s Trade Mark use however it contended that the use was authorised.[36] I note that s 59 requires only an intention to use, authorise the use of or assign the Trade Mark. The use of the Trade Mark by the Applicant’s parent company is not inconsistent with such an intention.  In any event, as Dodds-Streeton J in Suyen and the Full Court in Food Channel also said, lack of the requisite intention to use cannot be inferred from lack of use[37]. Therefore, I am not satisfied that Nike Inc’s use of the Trade Mark enables an inference to be drawn that the Applicant did not intend to use, authorise or assign the Trade Mark at the relevant date.

[36] Relying on Trident Seafoods Corp v Trident Foods Pty Ltd [2019] FCAFC 100 [45].

[37] Suyen [207].

67.   The Opponent also submitted that the evidenced use was of ‘NIKE AEROLOFT’, thereby indicating the secondary use of the Trade Mark, having no brand signification. It referenced Murphy J’s comments in Pinnacle regarding clothing manufacturers’ common use of style names which consumers understand are not operating as a badge of origin or a ‘sub-brand’ but to merely differentiate one garment range from another within the one collection[38]. The Downer exhibits contain several documents dated 2013 – 2015 promoting NIKE AEROLOFT garments and a variety of jackets and tops within that brand such as ‘Nike Aeroloft Summit Jacket’, ‘Nike Tech Fleece Aeroloft Windrunner’, ‘Nike Aeroloft Flash’ and others. It seems clear it is the latter elements, i.e. ‘Windrunner’, ‘Summit’ and ‘Flash’ which are apt to differentiate the garments within the range not AEROLOFT. Furthermore, the exhibits also demonstrate advertising of the garments without the ‘NIKE’ element such as the ‘Aeroloft 800 Vest’[39] and the ‘Aeroloft Kampai Jacket’[40]. Unlike ‘Delphine’, ‘AEROLOFT’ is not unremarkable in its use and, as the exhibits demonstrate, has been strongly promoted as a brand or at least a sub-brand of the house brand NIKE [41]. This material also evidences use of the Trade Mark in relation to class 25 Goods.

[38] Pinnacle Runway Pty Ltd v Triangl Limited [2019] FCA 1662 (‘Pinnacle’).

[39] Downer declaration Exhibit 3, p38 of 56.

[40] Downer declaration Exhibit 3, p 46 of 56.

[41] Pinnacle, [172]–[173], [177].

68.   For the above reasons I am not satisfied that the Opponent has established a prima facie case such as to cause the evidentiary onus to shift to the Applicant. The Applicant’s evidence, as discussed above, does not contra-indicate an intention to use (or authorise or assign) the Trade Mark but tends to confirm it. It follows that the Opponent has not discharged its onus to establish that the Applicant did not have the relevant intention at the relevant time to use, authorise or assign the Trade Mark.

69. Therefore, the s 59 ground has not been established.

Decision

70. Section 55 of the Act relevantly provides:

Decision

(1) Unless subsection (3) applies to the proceedings, the Registrar must, at the end, decide:

(a) to refuse to register the trade mark; or

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

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

71.   Subsection (3) does not apply to these proceedings. 

72.   The Opponent has failed to establish any of the grounds of opposition nominated in the SGP. Accordingly, the Trade Mark may proceed to registration after one month from the date of this decision. If the Registrar has been served with a notice of appeal before that time, I direct that registration shall not occur until either the appeal is withdrawn or a court so orders.

Costs

73. Both parties sought costs. As the Applicant was the successful party, I award costs against the Opponent under s 221 of the Act in the amounts set out in Schedule 8 of the Regulations.

M.Cooper
Hearing Officer
Delegate of the Registrar of Trade Marks
30 September 2020