Opposition by Mapleleaf Holdings Limited to the registration of trade mark application number 647940 in the name of Spartacus Publishing, Inc for the word trade mark

[1999] ATMO 109

TRADE MARKS ACT 1995

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

Re:Opposition by Mapleleaf Holdings Limited to the registration of trade mark application number 647940 in the name of Spartacus Publishing, Inc for the word trade mark TRANSFORMATION in Class 16

Background
Application number 647940 was filed on 8 December 1994, in the name of Spartacus Publishing, Inc (the applicant).  The application was for the registration of the trade mark TRANSFORMATION and, following amendment to the statement of goods during examination, covered, " Printed publications including magazines, newsletters, and catalogues " in Class 16.

Subsequent to examination, the application for the trade mark was advertised as accepted in the Australian Official Journal of Trade Marks of 15 August 1996.

A notice of opposition to the trade mark’s registration was filed by Mapleleaf Holdings Limited (the opponent), on 12 November 1996.  The notice of opposition listed a number of grounds, however, those finally relied upon were confirmed as such by the opponent's attorney at the hearing.  Of those, the grounds which I can infer as being legitimate under the Trade Marks Act 1995 (the present Act), and which were supported by the evidence and by submissions at the hearing, are under ss.41, 58, and 60.  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 Canberra.  At the hearing, the opponent was represented by Mr John Terry of Griffith Hack.  Appearing by telephone on behalf of the applicant was Mr Ben Fitzpatrick of Davies Collison Cave.

The Evidence
The evidence in support includes a declaration by Mark Burton, a Director of a company which distributes the opponent's goods.  He declares as to the history of the business relationship between those parties.  Next is a declaration by Albert Kaiser, a Principal of another distributor of the opponent's goods, who also details the length of his firm's relationship with the opponent.  Then there is a declaration from Raiko Ristic, the opponent's Sales Director, who outlines the history of the opponent company since 1984 and its use of the trade mark TRANSFORMATION on publications, and other goods and services, specifically for the transsexual and transvestite communities.  He declares that this use, in Australia, has been in relation to mail order customers since 1986 and via distributors since 1994. He details turnover and advertising financial data on goods bearing the mark.  Mr Ristic also outlines the history of his relationship with Jerry Deming/Jeri Lee (as is later evident, this is one and the same person) and he alleges some impropriety by that person with respect to the use of the mark TRANSFORMATION which, he says, is the property of the opponent.  Annexed to his declaration are copies of correspondence relating to his allegations and samples of what he states is copying from other publications by Jerry Deming.  Completing the evidence in support is the declaration by Stephanie Lloyd, the Managing Director of the opponent, who also gives the history of the opponent, its adoption of the disputed mark, gives some details on Australian customers for the opponent's goods, and gives a financial breakdown showing the Australian turnover and promotional activities relating to goods bearing the mark.  Ms Lloyd then gives an account of her business dealings with Jerry Deming and legal exchanges between the parties.  Annexed to this declaration are copies of material produced by the opponent, order forms and invoices said to show sales of goods by the opponent in Australia under the mark, advertisements from various publications showing the mark, a listing of trade mark applications and registrations in overseas countries, copies of correspondence between the parties, copies of the applicant's goods bearing the mark, and copies of correspondence between the opponent and its legal advisers.

The evidence in answer comprises two declarations by Benjamin Fitzpatrick, a solicitor employed by Davies Collison Cave.  In the first of these, Mr Fitzpatrick says that he has been advised by Nan Nesbitt, an authorised representative of the applicant, that that party had used the subject mark since 1984 in relation to Class 16 goods and other items, and he gives retail figures relating to that use from 1985 to 1996.  He annexes a publication bearing the mark and a list of Australian customers of the applicant's goods.  In his second declaration, he says that the applicant has obtained registration for its mark in France and Canada, and he annexes evidence of these registrations.

The evidence in reply comprises another declaration by Raiko Ristic where he annexes various copies of photographs from both parties' publications and other literature which, he says, show that the applicant has infringed the opponent's copyright.

Submissions
Mr Terry, in his submissions on behalf of the opponent, drew my attention to various details in the declarations in the evidence, saying that these showed that the opponent had established both first use and a considerable reputation in the mark TRANSFORMATION since well before the date of application here - from as early as 1984 and at least since 1986.  He said that the applicant was clearly seeking to expropriate the opponent's mark in Australia.

He also questioned the allowability of any material in the applicant's evidence from Nan Nesbitt, saying that this person was not shown to have any standing in the applicant company and was therefore not competent to make any statements on its behalf.  He said that, in any case, there was nothing in the applicant's evidence, other than unsupported claims, to show that the applicant had made first use of the mark in trade prior to the present application for registration.  He said that any claimed sales data in the evidence was clearly deficient, being undated and unsourced, and in failing to show whether the disputed mark had been used at all and, if it had, what items had actually been sold.

Mr Terry said that the opponent's evidence, in contrast, clearly showed that the applicant was not the owner of the mark because the opponent had used the mark first on the appropriate goods and that any reputation in the mark, amongst what was a narrow and specialised market, attached itself to the opponent.

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

On behalf of the applicant, Mr Fitzpatrick analysed each of the declarations in the opponent's evidence, saying that, although they indicated that the opponent might run a chain of retail stores in the United Kingdom which sold goods targeted to the transvestite and transsexual market, it could claim no use of the word TRANSFORMATION as a trade mark in Australia, in respect of printed publications such as magazines or newsletters.  He said that some goods which were not in class 16, had been offered for sale in this country under cover of a free TRANSFORMATION catalogue.  He said that this factor, and such authorities as Ferodo Ltd's App'n (1948) 62 RPC 111 and "Hospital World" Trade Mark (1967) RPC 595 showed that any use by the opponent was ancillary only and did not qualify as use on the goods themselves. He said that, even if it could be inferred that the mark had been used in trade on the catalogues, this did not equate to use on the goods covered by the present application. Mr Fitzpatrick said that, although the evidence did show that there had been some negotiations between the parties as to proposed use of the subject mark by the applicant on magazines in Australia, the opponent itself had never used the mark on such goods here. He said that the applicant's evidence had shown that it had used the mark first in Australia since 1984 on magazines. This, he submitted, had been uncontested by the opponent.

Accordingly, he said that the opponent had failed to show that it had first used the mark on the relevant goods which might then upset the applicant's claim to ownership of that mark.

Mr Fitzpatrick said that, because the applicant had already registered the opposed mark in a range of countries, including Canada, together with the fact that the opponent itself had applied for the registration of the mark, then this meant that the word TRANSFORMATION was clearly registrable in terms of s.41 of the Act.

In relation to the allegation that the use of the mark by the applicant was likely to lead to deception and confusion because of a reputation in it enjoyed by the opponent, Mr Fitzpatrick submitted that the opponent had failed to establish such a standing in the mark in its evidence.  He said that any turnover indicated in the applicant's evidence between 1986 to 1996 was very modest, and it was questionable whether those figures referred to goods sold under the mark in question or to other, differently branded goods.  He said that, therefore, any reputation claimed was in doubt - especially when it was not supported by independent evidence.

He closed by seeking costs in the matter in favour of the applicant.

Analysis
As I have previously stated, in giving the reasons for my decision in this opposition matter, I will only deal with what are valid grounds under the present Act to which the evidence relates and to which Mr Terry relied upon in the making of his submissions.

These are:
Section 41
This section of the Act, as it is relevant here, states:

Trade mark not distinguishing applicant's goods or services

(1)  …

(2)  An application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant's goods or services in respect of which the trade mark is sought to be registered (designated goods or services) from the goods or services of other persons.

(3)  In deciding the question whether or not a trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons, the Registrar must first take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons.

(4)  Then, if the Registrar is still unable to decide the question, the following provisions apply.

(5)  If the Registrar finds that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons but is unable to decide, on that basis alone, that the trade mark is capable of so distinguishing the designated goods or services:

(a)  The Registrar is to consider whether, because of the combined effect of the following:

(i) the extent to which the trade mark is inherently adapted to distinguish the designated goods or services;

(ii) the use, or intended use, of the trade mark by the applicant;

(iii) any other circumstances;

the trade mark does or will distinguish the designated goods or services as being those of the applicant; and

(b)  if the Registrar is then satisfied that the trade mark does or will distinguish the designated goods or services - the trade mark is taken to be capable of distinguishing the applicant's goods or services from the goods or services of other persons; and

(c)  if the Registrar is not satisfied that the trade mark does or will so distinguish the designated goods or services - the trade mark is taken not to be capable of distinguishing the applicant's goods or services from the goods or services of other persons.

(6)  If the Registrar finds that the trade mark is not inherently adapted to distinguish the designated goods or services from the goods or services of other persons, the following provisions apply:

(a)  if the applicant establishes that, because of the extent to which the applicant has used the trade mark before the filing date in respect of the application, it does distinguish the designated goods or services as being those of the applicant - the trade mark is taken to be capable of distinguishing the designated goods or services from the goods or services of other persons;

(b)  in any other case - the trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons.

Her Honour, Branson J observed in Blount Inc v The Registrar of Trade Marks (1998) 40 IPR 498 at 504 (the Oregon case) that, in applying the provisions of s41, and in deciding whether a trade mark is capable of distinguishing, the Registrar has three options. He or she may conclude:

(a)that the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons and capable, on that basis alone, of so distinguishing the designated goods or services; or

(b)that the trade mark is not to any extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons; or

(c)that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons, but there is uncertainty, on that basis alone, that the trade mark is actually capable of distinguishing the designated goods or services.

Justice Branson continued, at 504:

The structure of s 41 of the Act dictates that if the registrar reaches conclusion (a) above, then he or she will decide the question whether or not the trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons by reaching the answer that it is so capable by reason of its inherent adaptability to distinguish: s 41(2) and (3). The registrar will, in such circumstances, be required, by reason of the terms of s 33(1) of the Act, to accept the application unless he or she is satisfied that the application has not been made in accordance with the Act, or that there are grounds, independent of capacity to distinguish, for rejecting the application.

The explanatory notes to the present Act expand on the meaning of the term "inherently adapted to distinguish".  They say, inter alia:

Trade marks that are not inherently adapted to distinguish goods or services are mostly trade marks that consist wholly of a sign that is ordinarily used to indicate:

(a)  the kind, quality, quantity, intended purpose, value, geographic origin, or some other characteristic, of goods or services; or

(b)the time of production of goods or of the rendering of services.

In the present case, the trade mark applied for is the word TRANSFORMATION and the statement of goods generally comprises printed publications.  In what has proved to be quite an education, I have had the benefit of perusing the applicant's evidence, which exhibits the type of printed publication it produces.  This material includes a quite sexually explicit pamphlet which advertises transvestite and transsexual accessories and accoutrements.  The title of the publication shown is TRANSFORMATION, and it is sub-titled FROM MAN TO WOMAN.  It could therefore be inferred that, in context, the mark is used on goods specifically intended for a clientele who wish to undergo a permanent or temporary "transformation" from a man to a woman.  However, such an interpretation is, if somewhat figurative, a degree contrived.  Such allusions are not necessarily fatal to the applicant's case because a trade mark need not be absolutely unsuggestive - Burroughs Wellcome & Co's Trade Mark (1904) 21 RPC 217. Although the mark, when dissected in this way, might be said to have some reference to the goods, I think that, as a whole, it has sufficient inherent adaptation to distinguish those items.

Given the above, I am satisfied that, when used as a trade mark, the word TRANSFORMATION is capable of distinguishing the applicant's publications from those of others.  I therefore dismiss this ground of opposition.

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 goods or 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 the goods of a particular trader are being offered for sale, in Australia, under the trade mark.

However, the dispute of a claim of ownership of a mark will only succeed, where the opponent can show that the word or words it relies upon as being owned by itself or another person 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 in 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 trade mark claimed by both parties as their own in this case is the same - the word TRANSFORMATION.  Therefore, whichever party can show legitimate first use of that word as a trade mark on the appropriate goods must be the owner, according to the Act and the relevant authorities.

The opponent's declarants state that the mark has been used on publications in Australia since at least 1994, and that sales of some publications and other goods to mail-order clients have been taking place since 1986.  Sales figures are also provided from that year onwards, which are said to include Class 16 goods.  In the annexed material to Ms Lloyd's declaration, there are copies of some of the opponent's sales invoices from 1995 onwards showing Australian addresses which refer to publications called Transvestite Transformation, New Transformation Catalog (sic), Transsexual Transformation and Transformation (my emphasis).  There are also "TRANSFORMATION MAIL-ORDER" postal receipts to various Australian addresses for "books" dating from 1990.  All of this material appears to equate to use on catalogues, magazines and books - certainly goods encompassed by the general description, "printed publications" in the present application's statement of goods.

On the applicant's part, Mr Fitzpatrick, in his first declaration, stated that he had been advised by Nan Nesbitt that the applicant had first used the TRANSFORMATION trade mark in relation to a magazine and mail order catalogues since 1984.  However, the catalogues which were annexed as examples of this use, are undated, and the copy of the computer printout, said to be a list of the applicant's customers, includes only dates after the present application was filed and fails to mention the trade mark at all. It must follow, then, that any claims to ownership of the mark on behalf of the applicant can not be said to be based on any earlier date than that of the application for the subject trade mark.

I note here that, in his submissions, Mr Fitzpatrick said that if I did find that any use could be attributed to the opponent on catalogues, then that evidence did not substantiate a claim for the wider statement of goods here.  However, as I have said, the opponent appears, from the evidence, to have not only used the mark in relation to catalogues, but also on magazines and books.  In contrast, the opponent can only produce, in evidence, two catalogues as an attempt to show use on the subject goods.

Having considered all of this, I am satisfied that the opponent's evidence indicates that it first used the mark TRANSFORMATION on goods which are the "same kind of thing" as the present statement of goods, as contemplated in Hicks' case, supra, for some years prior to the present application having been made.  Against this, the applicant cannot point to any substantiated use which is before the date of filing.

It must follow then that the opponent is the first user of the mark on the relevant goods and, accordingly, the owner of the mark for those goods.  I find then that this ground of opposition is successful.

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.

The respective trade marks are identical.  This being the case, it now remains to be determined whether deception or confusion would be caused if the presently applied for mark is used on the goods in the specification, given the reputation of the opponent's trade mark.  In assessing that reputation, the relevant date to be considered is that of the filing of the opposed application - here 8 December 1994 - Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592. 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.

I do not think that I am wrong in saying that both of the applicant's and opponent's publications fall under the broad description of pornography.  This can be further defined, I think, into pornography intended specifically for consumption by transsexuals and transvestites.  I have no idea what exact proportion of the general pornography market that the transsexual/transvestite sector occupies but I will make an assumption, in the lack of contrary evidence, that it is not large.  Therefore, any claims that the turnover under the mark was not significant, in relation to the wider pornography market, must be considered in the light of this.  I would again assume that those communities would have a strong, non-mainstream, communication network based upon word of mouth.  This could be inferred to be because of the fear of intimidation, or perhaps merely to remain anonymous.  I believe then, that the readers of both parties' highly specialised publications, and the users of the goods advertised therein, would be a small but quite knowledgable group.

As I have already found, in relation to the ground of opposition under s.58, the opponent has been shown by its evidence to have used its trade mark on catalogues, magazines and books in Australia from at least 1994, and probably as early as 1986 - via mail-order customers. The applicant's declarant, Mr Fitzpatrick says that he was informed by Nan Nesbitt that the applicant had used the mark on its goods since 1984, but this is second-hand assertion at best and is unsupported by any other evidence.  Mr Fitzpatrick also submitted evidence of the Canadian registration of the word TRANSFORMATION, on behalf of the applicant, but this contributes nothing, in my estimation, to its reputation in this country.

All of this is sufficient to convince me that the opponent had a considerable reputation amongst a relatively small, discrete and specialised market.  Therefore, if a customer seeking the goods in question knew of the opponent's mark TRANSFORMATION, it would seem to be quite reasonable for that person to assume that any use of that word by the applicant for exactly the same goods would be on behalf of the opponent.  Consequently, I think that it is highly likely that a person, on encountering the applicant's mark used on the goods covered by the specification, would be deceived and/or confused as to origin, given the reputation enjoyed by the opponent for the same trade mark on a wide range of goods related to the transsexual and transvestite market.

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

Conclusion
I have found that the opponent has not been successful in relation to its ground of opposition under s.41, because the trade mark is capable of distinguishing the applicant's goods.  However, the opposition has been successful on the s.58 ground, because the opponent, and not the applicant, has been shown to be the owner of the trade mark; and under s.60, because the use of the mark on the goods covered by the specification would be likely to deceive or cause confusion, given the reputation of the opponent's trade mark.

Accordingly, as a 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 trade mark TRANSFORMATION covered by this application.

Costs
In respect of costs, I can see no reason why they should not follow the result.  Accordingly, I order that the applicant pay the opponent's costs in the matter, in accordance with the Official scale.

Ian Forno
Hearing Officer

28 October 1999