Opposition by KOREAN AIR LINES CO., LIMITED to the registration of trade mark application number 668958 in the name of MYONG GIL LEE and JIN HO LEE for the word trade mark

[1999] ATMO 91

TRADE MARKS ACT 1995

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

Re:Opposition by KOREAN AIR LINES CO., LIMITED to the registration of trade mark application number 668958 in the name of MYONG GIL LEE and JIN HO LEE for the word trade mark SKYPASS in Class 39.

Background
Application number 668958 was filed on 9 August 1995, in the name of Myong Gil Lee and Jin Ho Lee (the applicants).  The application was for the registration of the word trade mark SKYPASS and, following amendment, covered the statement of services, "Travel arrangements" in Class 39, at the time of acceptance.

Subsequent to examination, the application for the trade mark was accepted and advertised as such in the Australian Official Journal of Trade Marks of 2 October 1997.  A notice of opposition to the trade mark’s registration was filed on 11 December 1997, by Korean Air Lines Co., Limited (the opponent).

The notice of opposition listed a number of grounds.  However, the matters which were relied upon by the opponent's attorney at the hearing were the allegations: under s.58, that the applicants are not the owners of the opposed trade mark; under s.62, that the Registrar accepted the application on the basis of evidence or representations that were false in material particulars; under s.60, that the use of the trade mark would be likely to lead to deception and confusion because it is deceptively similar to the opponent's trade mark which had acquired a reputation in Australia before the priority date for registration of the present mark; and under s.43 that because of a connotation contained in the trade mark, the use of the trade mark would be likely to lead to deception and confusion.

Accordingly, those grounds are the subject of this decision and the reasons for it.

The opponent requested a hearing in the matter and it came before me, as a delegate of the Registrar, in Sydney on 9 March 1999.  The opponent was represented by Mr Peter Hansen of Freehills Patent Attorneys.  The applicants did not appear at the hearing, nor did they present any submissions for the Registrar's consideration.

The Evidence
The evidence in support comprised a declaration, dated 27 March 1998, by Chul Nam Yang, the Regional Manager of the Sydney Office of the opponent.  In his declaration, Mr Yang outlined the history of the opponent and its adoption and use of the trade mark SKYPASS in relation to its services.  Annexed to his declaration were exhibited copies of an inflight magazine, newspaper advertisements, membership application forms and international trade mark registration details, all relating to the opponent's use of the SKYPASS mark.

The applicants did not serve any evidence in answer in the matter.

Submissions
With respect to the ground that the applicants were not the owner of the subject trade mark, Mr Hansen said that the evidence showed that the opponent had used the word SKYPASS, as a trade mark and in relation to the services covered by the present application, from a date prior to that of the present application.  He said that the opponent conducted a frequent-flyer program under the name SKYPASS and, while it did not charge for services under that scheme, those services were ancillary to the principal services which that party supplied to its customers.  He said that the opponent was an airline which provided a range of transportation and travel services in this country, including the making of travel reservations, or "travel arrangements" - the goods covered by the present application - under the subject mark.  Accordingly, he said, the opponent was the true owner of the present trade mark in Australia.

Mr Hansen said that, if the opponent was successful under the s.58 leg of its opposition, it followed that the applicants had made a false representation in relation to being the true owners of the mark and the opponent must therefore be successful under the s.62(b) ground.

In relation to its opposition under s.60, Mr Hansen said that the opponent had a sufficient reputation in the disputed trade mark amongst the relevant portion of a specialised market.  He said that this reputation was in existence prior to the date of the present application and was sufficiently strong so that use of the mark by the applicants on their services would be likely to cause deception and confusion.  He submitted that this renown stemmed from the featuring of the opponent's frequent-flyer scheme in its inflight magazine, its advertisements in newspapers and the distribution of a brochure detailing the scheme.  All of this, he said, meant that a significant number of persons would have known of the opponent's relationship with the SKYPASS trade mark and that, consequently, there would be a real risk of deception and confusion if the present mark was allowed registration.

On the opponent's opposition ground under s.43, Mr Hansen said that, as a result of the opponent's past and continued use of the mark SKYPASS, it had a connotation that associated it with that party.  He referred for support here to the words of Justice Wilcox in Montana Tyres Rims & Tubes Pty Ltd v Transport Tyre Sales Pty Ltd 41 IPR 301 at 317, a case related to an assignment matter. Mr Hansen said that this meant that any use by the applicants of that word on the services of this application would lead to deception and confusion.

Mr Hansen said that the Registrar had a discretion to exercise in the present case.  He said that, in considering that discretion, I should take into account several surrounding factors.  These were that the applicants had shown little interest in defending the present case and had served no evidence in answer to the opposition.  Nor he said, had they appeared at the hearing.  In contrast, he said, the opponent had continued to use the mark and had over 11,500 members of its SKYPASS frequent-flyer scheme.  He said that I should also consider the purity of the Registrar by only allowing the registration of trade marks by the true owners of those marks.

He closed his submissions by seeking costs in favour of the opponent in the matter.

As I have already said, the applicants failed to make any submissions, in person or in writing, in rebuttal of the opposition.

Analysis
In considering my decision in the opposition matter, I will deal with each ground in turn which Mr Hansen relied upon in the making of his submissions.

Section 58

This section reads:

Applicant not owner of trade mark

58.  The registration of a trade mark may be opposed on the ground that the applicant is not the owner of the trade mark.

The term "owner" in the Trade Marks Act 1995 equates to that of "proprietor", as referred to in the Trade Marks Act 1955 - see p.2 of the Readers Guide to the 1995 Act.  The initial onus, with respect to ownership, is on the applicant for registration.  As stated in s.27 of the Act:

27.(1) A person may apply for the registration of a trade mark in respect of goods and/or services if:

(a)the person claims to be the owner of the trade mark; and

(b)one of the following applies:

(i)the person is using or intends to use the trade mark in relation to the goods and/or services;

(ii)the person has authorised or intends to authorise another person to use the trade mark in relation to the goods and/or services;

(iii)the person intends to assign the trade mark to a body corporate that is about to be constituted with a view to the use by the body corporate of the trade mark in relation to the goods and/or services.

Ownership depends on a combination of authorship and first use and, as per Shell Co. (Aust.) Ltd v Rohm and Haas Co. (1949) 78 CLR 601, may be claimed either on the basis of use of the trade mark, in relation to the nominated services, or on the basis of the making of an application for registration. However, that ownership is limited to "the same kind of thing" - as per Holroyd J in Hicks’ case (1897) 22 VLR 636. Any small amount of use will suffice, but the effect of the act relied on to constitute use must be the creation, in the minds of those concerned, of an impression that services of a particular trader are being offered for sale, in Australia, under the trade mark.

A claim of ownership of a mark will only succeed in displacing a trade mark application, however, where the opponent can show that the trade mark it relies upon is substantially identical with the mark, the subject of the application for registration.  In Carnival Cruise Lines Inc v Sitmar Cruises Ltd. (1994) AIPC 91- 049 at 38,114, when referring to the concept of proprietorship under the Trade Marks Act 1955, and to Shell Co. (Aust.) Ltd v Rohm and Haas, supra, Gummow J. said:

[Shell v Rohm and Haas] does not supply any general authority for the proposition that in the case of disputed claims to proprietorship under the present statute anything less than substantial identity between the two marks will suffice. The phrase "substantially identical"  was discussed by Windeyer J. in The Shell  Company of Australia Limited v Esso Standard Oil (Australia) Limited (1961-1963) 109 CLR 407 at 414. It requires a total impression of similarity to emerge from a comparison between the two marks.

The opponent's trade mark is, from its evidence, the word SKYPASS. Again from that evidence, which is undisputed, it started using that word, as a trade mark, in relation to a frequent flyer program in "about March-April" 1995.  The subject trade mark is the same word but application was not made for its registration until later than that time - 9 August 1995.  Therefore, as countenanced in Shell Co. (Aust.) Ltd v Rohm and Haas, and Carnival Cruise Lines Inc v Sitmar Cruises Ltd., both supra, the opponent may be inferred as being the owner of the mark if the services which the opponent provided under it are the "same kind of thing" - see Hicks' case, also supra - as the present statement of services.  Those services are, ambiguously, "Travel arrangements" in Class 39.  The opponent, from the evidence, uses the mark in relation to a frequent flyer program.  This program allows SKYPASS members to receive accelerated ticketing, facilitated boarding processes, seating class upgrades, together with free airline travel, following an accumulation of qualifying points through previous trips whilst a member of the scheme.  All of these things, given the imprecision of the term, could be regarded as being the "same kind of thing" as "travel arrangements".  Therefore, given the tests laid down in the relevant case law, I can only decide that the opponent is the true owner of the mark in question.

I accordingly find, given such a situation, that the opponent is successful on this ground of its opposition.

Section 62
This section reads, as is relevant here:
Application etc. defective etc.
62. The registration of a trade mark may be opposed on any of the following grounds:
…

(b) that the Registrar accepted the application for registration on the basis of evidence or representations that were false in material particulars.

The applicants applied to register the present trade mark by claiming that they were its owners.  As I have already found under s.58 that this is not the case, then it must follow that the Registrar accepted the mark for registration on the basis of a false representation.

Accordingly, I find that the opponent is successful on this ground of its opposition.

Section 60
This section reads:
Trade mark similar to trade mark that has acquired a reputation in Australia

60.  The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:
(a)  it is substantially identical with, or deceptively similar to, a trade mark that, before the priority date for the registration of the first-mentioned trade mark in respect of those goods or services, had acquired a reputation in Australia; and
(b)  because of the reputation of that other trade mark, the use of the first-mentioned trade mark would be likely to deceive or cause confusion.

I have already found that the mark covered by the present application is the same as the opponent's trade mark.  It now remains to be determined whether the opponent's reputation in its trade marks was sufficient, as at the relevant date, so that deception or confusion would be caused if the present trade mark was used on the goods in the present specification.  In assessing that reputation, the relevant date to be considered is that of the filing of the opposed application - Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 - here 9 August 1995. A mere possibility of confusion is not enough. There must be a real, tangible danger of its occurring. It is accepted law that the risk of deception and confusion must extend to a substantial number of people likely to be concerned in the purchasing of the particular goods or services - Kendall Co v Mulsyn Paint and Chemicals (1963) 109 CLR 300.

The opponent's undisputed evidence shows that it had promoted the SKYPASS frequent flyer scheme in its inflight magazine, a brochure and in newspapers.  It also showed, in its evidence, that it had received some responses to this advertising.  However, the earliest reference to the mark that I can find in that material, is a newspaper advertisement of 30 March 1995.  The subject inflight magazine is dated April 1995, the brochure appears to be dated 13 April 1995, while the earliest application for membership - of the only two in the evidence - is 21 April 1995.  All of this means that the opponent's promotion of its scheme was a little over 4 months in duration by the date of the present application.  This is not, to my mind, sufficient to establish a sufficient reputation, as countenanced in the legislation or the relevant case law, so that use of the mark would be likely to deceive or cause confusion among a substantial number of people involved in purchasing services in the relevant market.

I therefore find that the opponent is not successful on this ground of its opposition.

Section 43
This section of the Act reads:
Trade mark likely to deceive or cause confusion

43.  An application for the registration of a trade mark in respect of particular goods or services must be rejected if, because of some connotation that the trade mark or a sign contained in the trade mark has, the use of the trade mark in relation to those goods or services would be likely to deceive or cause confusion.

In determining this ground, I note that the word "connotation" is a new term in Australian trade mark legislation.  The following are two dictionary definitions which interpret the ordinary meaning of that word:
Macquarie Dictionary:

1. the act or fact of connoting.  2. that which is connoted; secondary implied or associated meanings (as distinguished from denotation): for example the word "bum" has connotations of vulgarity.

Oxford English Dictionary:

1. The signifying in addition; inclusion of something in the meaning of a word besides what it primarily denotes; implication.

With reference to Mr Hansen's submissions on the application of s.43, where he relied on a reference to that section by Justice Wilcox in Montana Tyres Rims & Tubes Pty Ltd v Transport Tyre Sales Pty Ltd, supra, I consider that those words, were obiter only and made without the benefit of reference to the Explanatory Memorandum to the Trade Marks Bill 1995.  I believe the true situation to be as per the dissenting judgment of Justice Branson in Registrar of Trade Marks v Woolworths [1999] FCA 1020 (29 July 1999), as yet unreported, where she said, having regard to the intention of s.43, as disclosed in the Second Reading Speeches for the Trade Marks Bill 1995, that:

Section 43, which is a ground for the rejection of an application for registration of a trade mark, looks to the inherent qualities of the trade mark of which registration is sought for the purpose of identifying whether the use of the trade mark would be likely to deceive or cause confusion. - (my emphasis)

The majority judges in that case did not find differently from Her Honour on that point.

Therefore it can be said that the word connotation refers to that which is implied in a trade mark - in addition to its essential or primary meaning.  A connotation can result from the trade mark as a whole, or can result from a sign contained within the trade mark.  The prominence and context of the potentially deceptive or confusing element in the trade mark is important in deciding whether the trade mark is likely to deceive or cause confusion.  Considerations under s.43 must therefore concentrate on the matter within the trade mark that could cause deception or confusion in the mind of the relevant buying public.  The trade mark here is the word SKYPASS.  It is necessary, for the purposes of s.43, to look at the mark in the context of the services, which are, specifically "travel arrangements".  I cannot agree that there is any connotation in this word which would mean that its use, in relation to those services, could lead to deception and confusion amongst air travellers.

I therefore find that the opposition, so far as it relies upon s.43, is not made out.

Conclusion
Given the foregoing, I find that the opponent has been successful on the s.58 ground, because the applicants are not the owners of the mark, that owner being the opponent; and the s.62 ground, that the application was accepted on the basis of false representations made by the applicants.  However, it has failed to establish a case in relation to the s.60 ground, because it did not have sufficient reputation, as at the date of application, so that deception or confusion would ensue if the mark was used by the applicants on the services in the specification; and on the s.43, ground, because there is no connotation in the mark which would mean that its use in relation to the subject services would lead to deception and confusion.

As I have said, the applicants did not serve any evidence in answer nor did they make any representations in relation to rebutting the opposition.  Given this, and the opponent's success under ss.58 and 62, I can see no reason to exercise the Registrar's discretion in favour of the applicants.

Accordingly, as the delegate of the Registrar, I find that the opponent is successful in its opposition as a whole and, subject to an appeal from this decision, I refuse to register the mark, the subject of this application.

Costs
In respect of costs, I can see no reason why costs should not follow the result.  I therefore award costs in the matter to the opponent, such costs to be, on application, taxed, certified and allowed by a trade marks officer appointed by the Registrar for that purpose.

Ian Forno
Hearing Officer

31 August 1999